According to a latest study of local authorities, English councils are preparing to sell social clubs, sports centres, and retail spaces as they rely on a rapid disposal of assets to balance the books.
Growing Fiscal Pressures Drive Asset Sales
The Key Cities Group for major urban areas in England stated that six out of ten of councils are intending to dispose of properties to cover the rising costs of adult and children’s social care.
Councils have previously come under fire for disposing of playing fields and land to shore up their finances, but they argue they must proceed to raise vital cash from property disposals or face insolvency.
This coalition noted that a high proportion of authorities seeking to generate funds from a fire sale of assets marked “a clear change from 2024, when the largest share (six in ten) of local leaders said they would focus on service redesigns and using savings to weather growing fiscal pressures.”
Specific Examples of Proposed Disposals
Medway Council in Kent announced its property management strategy featured the sale of a retail complex in Rainham and a community venue in another town to generate £20m over five years.
- Gillingham golf club and commercial properties held in two English counties, which all generate rent for the authority, will additionally be sold under the plan.
Local Levy Rises and Wider Financial Strains
This research of councils in the coalition, which includes several urban centers, also found that more than 70% of councils will need to raise council taxes next spring to cover the growing cost of core provisions, higher levels of housing insecurity, and a persistent accommodation deficit.
The authority explained it will proceed with property disposals after steep rises in the cost of children services, special educational needs and disability (Send) provision, elderly and disability services, and short-term housing.
“We are adopting innovative approaches but some of these take time to deliver both better provisions and financial savings,” said a council leader.
He added: “There are demographic pressures which will persist to add to the strains we have. As a unitary authority, we had a 91% cut in our central funding from over the past decade, which is very challenging.”
National Patterns and Projections
Research of regional authorities this week also found council budgets being stretched by the growing number of children and older individuals requiring special educational assistance.
A network of councils projected that local shortfalls will reach £4.4bn a year by 2029, as they struggle to manage rising needs.
Government officials have delayed planned reforms to the special educational needs framework until next year after a policy document setting out those changes has been postponed.
Deprivation and Financial Gaps
Based on the latest deprivation measures (IMD) covering UK local authorities, many participating urban areas were among the most disadvantaged in England.
- “Participating urban centers like Hull, Bradford, Stoke-on-Trent, Sunderland and Wolverhampton rank in the most deprived 30 nationally under the latest IMD measures,” said the study.
“While only one key city is in the top 10 for disadvantaged communities countrywide, urban areas are far more likely to be in the worst-off 20% of the nation. The figures highlights the extent of challenges confronting local leaders across key cities in the coming year,” the report added.
“Council officials have been explicit about the need for a fair and sustainable financial structure that accounts for and responds to the actual extent of deprivation and demand,” stated a council leader.
“Lacking this, councils will persist to face difficult decisions around which vital provisions to allocate spend to, and which to reduce, to the detriment of their residents.”
A fifth of local authorities have cut or compromised care services in the last year, the study revealed.
