According to a new survey of municipal councils, English councils are preparing to offload community centers, athletic facilities, and retail spaces as they rely on a rapid disposal of properties to balance the books.
Growing Fiscal Challenges Drive Asset Sales
The Key Cities Group representing second-tier cities in England stated that six out of ten of councils are planning to dispose of properties to meet the rising costs of adult and children’s social care.
Local governments have previously come under fire for selling playing fields and open spaces to support their finances, but they contend they must continue to raise vital cash from asset sales or face insolvency.
This coalition said that a high proportion of authorities seeking to raise money from a fire sale of holdings represented “a clear change from 2024, when the majority (60%) of local leaders said they would prioritise service redesigns and using financial reserves to manage increasing fiscal pressures.”
Detailed Cases of Planned Sales
One local authority in Kent said its property management strategy featured the disposal of a shopping centre in a local town and a community venue in another town to generate 20 million pounds over five years.
- Gillingham golf club and commercial properties held in two English counties, which all generate rent for the authority, will also be disposed of under the strategy.
Local Levy Rises and Broader Financial Strains
This research of councils in the key cities group, which covers Sunderland, Southampton, Gloucester and Salford, also found that over seven in ten of authorities will need to increase local levies next spring to address the growing cost of essential services, higher levels of homelessness, and a persistent accommodation deficit.
Medway council said it will proceed with property disposals after steep rises in the cost of youth support, support for vulnerable learners, elderly and disability services, and short-term housing.
“We are taking creative strategies but some of these require time to deliver both better provisions and cost efficiency,” stated Vince Maple.
He continued: “There are population challenges which will persist to add to the pressures 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 Projections
Research of county councils recently further found council budgets being stretched by the increasing figures of children and older individuals requiring Send support.
The County Councils Network projected that local shortfalls will hit £4.4bn a year by the end of the decade, as they grapple to manage increased demand.
Ministers have put off scheduled changes to the Send system until the coming year after a policy document setting out those changes was recently delayed.
Disadvantage and Funding Shortfalls
Based on the most recent deprivation measures (the Index of Multiple Deprivation) for UK local authorities, many key cities members were included in the most disadvantaged in the country.
- “Participating urban centers like several major towns rank in the most deprived 30 nationally under the latest deprivation indices,” noted the report.
“While only one key city is among the ten most deprived for disadvantaged communities nationally, cities are far more likely to be in the most deprived fifth of England. The data underscores the extent of difficulties facing local leaders across major urban centers in the next twelve months,” the analysis added.
“Local government leaders have been explicit about the need for a fair and sustainable funding system that accounts for and addresses the actual extent of deprivation and need,” said a council leader.
“Without this, councils will continue to face difficult decisions around which vital provisions to fund, and which to cut, to the disadvantage of their communities.”
A fifth of local authorities have reduced or weakened social care provision in the past 12 months, the survey found.
