🔗 Share this article

According to a new poll of local authorities, UK councils are planning to sell social clubs, sports centres, and retail spaces as they bet on a rapid disposal of properties to stabilize finances.

Increasing Fiscal Challenges Drive Asset Sales

The Key Cities Group for second-tier cities in England reported that 60% of councils are intending to dispose of properties to meet the escalating costs of social services for vulnerable individuals.

Councils have in the past come under fire for disposing of playing fields and land to support their budgets, but they contend they must proceed to raise vital cash from asset sales or face insolvency.

The group said that a high proportion of councils seeking to raise money from a fire sale of assets represented “a clear change from 2024, when the majority (60%) of municipal officials said they would focus on service redesigns and utilising savings to manage growing fiscal pressures.”

Detailed Examples of Planned Disposals

Medway Council in southeast England said its asset disposal plan included the disposal of a shopping centre in a local town and a community venue in Rochester to generate 20 million pounds over the next half-decade.

• Gillingham golf club and commercial properties owned in Worcestershire and Suffolk, which all generate rent for Medway council, will additionally be sold under the plan.

Local Levy Rises and Wider Fiscal Strains

The survey of local authorities in the coalition, which includes Sunderland, Southampton, Gloucester and Salford, further found that over seven in ten of authorities will have to increase council taxes next spring to cover the rising cost of essential services, higher levels of housing insecurity, and a persistent housing shortage.

Medway council explained it will press ahead with property disposals after sharp increases 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 some of these take time to deliver both improved services and cost efficiency,” stated Vince Maple.

He added: “There are demographic pressures which will persist to increase the strains we have. As a unitary authority, we had a drastic reduction in our central funding from 2010-24, which is extremely difficult.”

Countrywide Trends and Projections

A survey of county councils this week further found local finances being strained by the growing number of young people and adults needing special educational assistance.

The County Councils Network projected that local shortfalls will reach 4.4 billion pounds a year by the end of the decade, as they struggle to manage increased demand.

Government officials have put off planned reforms to the Send system until the coming year after a white paper outlining those reforms has been postponed.

Disadvantage and Financial Shortfalls

According to the most recent indices of deprivation (the Index of Multiple Deprivation) covering English councils, several key cities members were among the most disadvantaged in England.

• “Participating urban centers like several major towns rank in the top 30 nationally under the latest IMD measures,” said the report.

“Although only one key city is in the ten most deprived for deprived neighbourhoods nationally, cities are far more likely to be in the most deprived fifth of England. The figures underscores the scale of challenges confronting local leaders across major urban centers in the next twelve months,” the report concluded.

“Local government leaders have been clear about the necessity for a fair and sustainable financial structure that accounts for and addresses the real levels of deprivation and need,” stated a council leader.

“Without this, local authorities will continue to face difficult decisions around which vital provisions to fund, and which to reduce, to the disadvantage of their residents.”

A fifth of local authorities have reduced or weakened care services in the past 12 months, the study revealed.