Based on a new poll of local authorities, English councils are planning to sell community centers, athletic facilities, and shopping arcades as they bet on a rapid disposal of assets to balance the books.
Growing Fiscal Challenges Drive Asset Sales
A coalition of councils representing major urban areas in the UK reported that six out of ten of local authorities are planning to sell assets to meet the rising costs of adult and children’s social care.
Local governments have in the past come under fire for selling public land and land to support their finances, but they argue they must proceed to generate essential revenue from asset sales or face insolvency.
The group noted that a high proportion of authorities attempting to generate funds from a fire sale of assets represented “a clear change from 2024, when the largest share (six in ten) of local leaders said they would prioritise service redesigns and using financial reserves to weather increasing fiscal pressures.”
Specific Examples of Proposed Sales
One local authority in southeast England announced its asset disposal plan included the sale of a shopping centre in Rainham and a social club in another town to generate 20 million pounds over five years.
- A local golf course and commercial properties held in two English counties, which all provide rental income for Medway council, will also be sold under the strategy.
Local Levy Increases and Broader Financial Pressures
This research of councils in the key cities group, which covers several urban centers, further found that more than 70% of authorities will have to increase local levies next April to cover the rising cost of essential services, increased rates of housing insecurity, and a longstanding accommodation deficit.
Medway council said it will press ahead with asset sales after sharp increases in the cost of children services, support for vulnerable learners, elderly and disability services, and temporary accommodation.
“We are taking innovative approaches but some of these take time to achieve both better provisions and cost efficiency,” stated Vince Maple.
He added: “There are population challenges which will continue to add to the strains we have. As a local government body, we had a 91% cut in our revenue support grant from over the past decade, which is extremely difficult.”
National Patterns and Forecasts
Research of regional authorities this week also found local finances being strained by the increasing figures of young people and adults needing special educational assistance.
A network of councils said that local shortfalls will reach 4.4 billion pounds a year by 2029, as they struggle to manage rising needs.
Ministers have delayed planned reforms to the special educational needs framework until next year after a policy document outlining those changes has been postponed.
Deprivation and Financial Shortfalls
According to the most recent deprivation measures (IMD) covering English councils, many participating urban areas were included in the most deprived in the country.
- “Member cities like several major towns rank in the top 30 nationally under the latest deprivation indices,” said 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 worst-off 20% of the nation. The figures underscores the extent of challenges confronting local leaders across major urban centers in the next twelve months,” the analysis concluded.
“Local government leaders have been clear about the necessity for a equitable and lasting funding system that accounts for and responds to the real levels of deprivation and demand,” stated a council leader.
“Lacking this, local authorities will persist to face impossible choices around which vital provisions to fund, and which to reduce, to the detriment of their communities.”
One in five of local authorities have reduced or weakened social care provision in the last year, the survey found.
