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Based on a recent study of municipal councils, English councils are planning to sell community centers, athletic facilities, and shopping arcades as they bet on a rapid disposal of assets to stabilize finances.

Growing Fiscal Challenges Prompt Asset Sales

A coalition of councils representing major urban areas in the UK stated that 60% of local authorities are planning to dispose of properties to cover the rising costs of adult and children’s social care.

Local governments have in the past faced criticism for disposing of playing fields and open spaces to support their budgets, but they argue they must proceed to raise vital cash from property disposals or declare themselves bankrupt.

The group noted that a high proportion of councils seeking to generate funds from a quick sale of holdings marked “a clear change from 2024, when the largest share (six in ten) of municipal officials said they would focus on restructuring services and utilising savings to manage growing financial challenges.”

Specific Examples of Planned Disposals

Medway Council in Kent announced its property management strategy included the sale of a retail complex in a local town and a community venue in another town to generate £20m over five years.

• Gillingham golf club and business parks owned in Worcestershire and Suffolk, which all generate rent for Medway council, will also be disposed of under the plan.

Local Levy Increases and Wider Fiscal Strains

The survey of councils in the coalition, which includes several urban centers, further found that more than 70% of authorities will need to raise council taxes next April to cover the rising cost of essential services, higher levels of housing insecurity, and a longstanding housing shortage.

Medway council said it will proceed with property disposals after steep rises in the cost of youth support, special educational needs and disability (Send) provision, adult social care, and short-term housing.

“We are adopting innovative approaches but some of these take time to deliver both better provisions and cost efficiency,” said a council leader.

He continued: “There are population challenges which will persist to increase the pressures we have. As a unitary authority, we had a drastic reduction in our revenue support grant from over the past decade, which is extremely difficult.”

National Trends and Forecasts

Research of regional authorities recently further found local finances being stretched by the growing number of young people and adults requiring Send support.

A network of councils projected that council deficits will reach £4.4bn a year by 2029, as they struggle to cope with rising needs.

Government officials have delayed scheduled changes to the Send system until next year after a white paper setting out those reforms has been postponed.

Disadvantage and Funding Shortfalls

Based on the latest deprivation measures (IMD) covering English councils, many key cities members were included in the most deprived in England.

• “Member cities like Hull, Bradford, Stoke-on-Trent, Sunderland and Wolverhampton rank in the most deprived 30 across the country under the latest deprivation indices,” noted the study.

“Although only one key city is among the top 10 for disadvantaged communities nationally, cities are much more prone to be in the most deprived fifth of the nation. The data highlights the extent of difficulties facing local leaders across key cities in the coming year,” the report concluded.

“Local government leaders have been clear about the need for a fair and sustainable funding system that reflects and addresses the actual extent of disadvantage and demand,” stated a council leader.

“Lacking this, councils will persist to face impossible choices around which vital provisions to fund, and which to cut, to the disadvantage of their communities.”

One in five of local authorities have cut or compromised care services in the past 12 months, the survey found.