Based on a latest poll of municipal councils, UK councils are preparing to sell community centers, sports centres, and retail spaces as they rely on a fire sale of assets to balance the books.
Increasing Financial Challenges Prompt Asset Sales
The Key Cities Group for major urban areas in England stated that 60% of councils are planning to sell assets to cover the escalating costs of adult and children’s social care.
Councils have previously come under fire for disposing of playing fields and open spaces to support their budgets, but they argue they must continue to generate essential revenue from asset sales or declare themselves bankrupt.
The group said that a significant number of authorities attempting to raise money from a fire sale of holdings represented “a clear change from 2024, when the largest share (60%) of municipal officials said they would focus on service redesigns and utilising financial reserves to manage increasing fiscal pressures.”
Specific Examples of Planned Disposals
Medway Council in Kent said its property management strategy included the sale of a retail complex in Rainham and a social club in another town to generate £20m over the next half-decade.
- Gillingham golf club and business parks owned in two English counties, which all generate rent for the authority, will also be sold under the plan.
Council Tax Rises and Wider Financial Pressures
This research of local authorities in the coalition, which covers Sunderland, Southampton, Gloucester and Salford, also found that over seven in ten of councils will need to increase council taxes next April to cover the rising cost of core provisions, higher levels of housing insecurity, and a longstanding housing shortage.
The authority explained it will press ahead with asset sales after steep rises in the cost of children services, special educational needs and disability (Send) provision, adult social care, and short-term housing.
“We are taking creative strategies but certain measures require time to achieve both improved services and financial savings,” stated a council leader.
He continued: “We face demographic pressures which will continue to add to the strains we have. As a local government body, we had a 91% cut in our central funding from over the past decade, which is extremely difficult.”
National Patterns and Forecasts
A survey of regional authorities recently further found local finances being strained by the increasing figures of children and older individuals needing special educational assistance.
A network of councils said that local shortfalls will hit 4.4 billion pounds a year by the end of the decade, as they grapple to manage rising needs.
Ministers have delayed planned reforms to the special educational needs framework until next year after a white paper outlining those reforms has been postponed.
Disadvantage and Financial Gaps
According to the latest deprivation measures (IMD) for English councils, many participating urban areas were among the most deprived in the country.
- “Participating urban centers like several major towns place in the most deprived 30 nationally under the 2025 IMD measures,” said the report.
“Although only one key city is among the ten most deprived for deprived neighbourhoods nationally, cities are far more likely to be in the worst-off 20% of the nation. The data underscores the extent of difficulties facing municipal officials across major urban centers in the next twelve months,” the report concluded.
“Council officials have been explicit about the need for a equitable and lasting funding system that reflects and addresses the actual extent of deprivation and demand,” stated a council leader.
“Without this, local authorities will continue to face impossible choices around which essential services to allocate spend to, and which to reduce, to the detriment of their residents.”
One in five of councils have reduced or weakened care services in the last year, the study found.
