Based on a new survey of municipal councils, English councils are preparing to sell social clubs, athletic facilities, and shopping arcades as they bet on a fire sale of assets to balance the books.
Growing Fiscal Pressures Prompt Asset Sales
A coalition of councils for second-tier cities in England stated that six out of ten of councils are intending to dispose of properties to cover the escalating costs of adult and children’s social care.
Local governments have in the past faced criticism for selling public land and land to shore up their finances, but they argue they must proceed to generate essential revenue from property disposals or declare themselves bankrupt.
The group said that a high proportion of authorities seeking to generate funds from a fire sale of assets marked “a clear change from 2024, when the majority (60%) of municipal officials said they would prioritise restructuring services and utilising savings to manage growing fiscal pressures.”
Specific Cases of Proposed Sales
One local authority in Kent announced its asset disposal plan included the sale of a shopping centre in Rainham and a social club in Rochester to generate 20 million pounds over five years.
- Gillingham golf club and business parks held in two English counties, which all generate rent for the authority, will also be disposed of under the strategy.
Council Tax Increases and Broader Fiscal Pressures
The survey of local authorities in the key cities group, which includes Sunderland, Southampton, Gloucester and Salford, also found that more than 70% of authorities will have to raise council taxes next April to address the rising cost of core provisions, increased rates of housing insecurity, and a persistent housing shortage.
The authority said it will press ahead with asset sales after sharp increases in the cost of youth support, special educational needs and disability (Send) provision, adult social care, and temporary accommodation.
“We are taking innovative approaches but certain measures require time to achieve both better provisions and financial savings,” stated a council leader.
He added: “There are demographic pressures which will persist to add to the pressures we have. As a unitary authority, we had a 91% cut in our central funding from 2010-24, which is extremely difficult.”
National Patterns and Projections
A survey of regional authorities this week also found council budgets being strained by the growing number of children and adults requiring Send support.
The County Councils Network projected that council deficits will hit £4.4bn a year by the end of the decade, as they grapple to cope with increased demand.
Government officials have put off planned reforms to the special educational needs framework until next year after a policy document outlining those changes has been postponed.
Disadvantage and Funding Shortfalls
Based on the latest indices of deprivation (IMD) for English councils, several key cities members were among the most deprived in the country.
- “Member cities like several major towns place in the top 30 nationally under the 2025 IMD measures,” noted the report.
“While only one key city is in the top 10 for disadvantaged communities countrywide, urban areas are much more prone to be in the worst-off 20% of the nation. The data underscores the scale of difficulties confronting municipal officials across key cities in the coming year,” the analysis added.
“Local government leaders have been explicit about the necessity for a fair and sustainable financial structure that accounts for and addresses the real levels of disadvantage and demand,” said Michael Mordey.
“Without this, councils will persist to face difficult decisions around which essential services to fund, and which to cut, to the detriment of their residents.”
One in five of local authorities have reduced or weakened care services in the last year, the study found.
