Based on a new study of municipal councils, UK councils are planning to sell social clubs, athletic facilities, and shopping arcades as they bet on a rapid disposal of assets to balance the books.
Growing Financial Pressures 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 cover the rising 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 continue to raise vital cash from property disposals or face insolvency.
The group said that a high proportion of councils seeking to raise money from a quick sale of holdings represented “a distinct shift from 2024, when the majority (six in ten) of municipal officials said they would prioritise restructuring services and using savings to manage increasing financial challenges.”
Specific Cases of Proposed Disposals
One local authority in Kent announced its property management strategy included the disposal of a shopping centre in Rainham and a social club in another town to raise £20m over five years.
- A local golf course and business parks owned in two English counties, which all provide rental income for Medway council, will also be disposed of under the strategy.
Local Levy Increases and Wider Fiscal Strains
This research of local authorities in the key cities group, which covers Sunderland, Southampton, Gloucester and Salford, also found that over seven in ten of councils will need to raise council taxes next spring to address the growing cost of essential services, higher levels of homelessness, and a persistent housing shortage.
The authority explained it will proceed 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 adopting creative strategies but certain measures take time to deliver both improved services and cost efficiency,” stated Vince Maple.
He added: “We face demographic pressures which will continue to increase the strains we have. As a unitary authority, we had a 91% cut in our revenue support grant from 2010-24, which is very challenging.”
National Patterns and Projections
Research of regional authorities this week further found council budgets being stretched by the increasing figures of children and older individuals needing Send support.
The County Councils Network projected that council deficits will hit 4.4 billion pounds a year by 2029, as they grapple to cope with increased demand.
Ministers have delayed planned reforms to the special educational needs framework until next year after a policy document outlining those changes was recently delayed.
Deprivation and Funding Gaps
Based on the most recent indices of deprivation (IMD) covering English councils, several participating urban areas were among the most disadvantaged in the country.
- “Participating urban centers like Hull, Bradford, Stoke-on-Trent, Sunderland and Wolverhampton place in the top 30 across the country under the 2025 IMD measures,” noted the report.
“Although only a single urban area is among the top 10 for deprived neighbourhoods countrywide, cities are far more likely to be in the most deprived fifth of England. The data highlights the extent of difficulties confronting local leaders across major urban centers in the coming year,” the analysis concluded.
“Local government leaders have been clear about the need for a equitable and lasting financial structure that reflects and addresses the actual extent of deprivation and need,” stated a council leader.
“Lacking this, councils will persist 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 cut or compromised care services in the past 12 months, the survey found.
