According to a new survey of local authorities, UK councils are preparing to offload social clubs, athletic facilities, and shopping arcades as they bet on a fire sale of properties to stabilize finances.
Growing Financial Challenges Prompt Asset Sales
A coalition of councils for major urban areas in England reported that six out of ten of councils are intending to sell assets to cover the escalating costs of social services for vulnerable individuals.
Local governments have previously come under fire for disposing of public land and open spaces to shore up their finances, but they argue they must continue to raise vital cash from asset sales or declare themselves bankrupt.
The group noted that a high proportion of councils attempting to raise money from a fire sale of assets represented “a distinct shift from 2024, when the largest share (60%) of municipal officials stated they would prioritise service redesigns and using financial reserves to weather increasing fiscal pressures.”
Detailed Cases of Planned Disposals
One local authority in Kent said its asset disposal plan featured the disposal of a shopping centre in a local town and a community venue in Rochester to generate £20m over five years.
- A local golf course and business parks owned in Worcestershire and Suffolk, which all generate rent for Medway council, will additionally be disposed of under the plan.
Local Levy Rises and Wider Fiscal Strains
This research of councils in the coalition, which includes Sunderland, Southampton, Gloucester and Salford, also found that more than 70% of councils will have to increase council taxes next April to address the growing cost of essential services, higher levels of housing insecurity, and a persistent housing shortage.
Medway council said it will press ahead with asset sales after steep rises in the cost of children services, special educational needs and disability (Send) provision, elderly and disability services, and short-term housing.
“We are taking creative strategies but some of these take time to achieve both improved services and financial savings,” said a council leader.
He added: “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 very challenging.”
National Patterns and Projections
A survey of county councils this week further found council budgets being strained by the growing number of young people and adults requiring special educational assistance.
A network of councils said that local shortfalls will hit £4.4bn a year by the end of the decade, as they struggle to cope with increased demand.
Government officials have put off planned reforms to the special educational needs framework until next year after a white paper outlining those reforms has been postponed.
Deprivation and Funding Shortfalls
Based on the latest deprivation measures (the Index of Multiple Deprivation) for English councils, several key cities members were among the most disadvantaged in the country.
- “Member cities like several major towns place in the top 30 across the country under the 2025 deprivation indices,” said the study.
“While only a single urban area is in the ten most deprived for disadvantaged communities nationally, urban areas are far more likely to be in the worst-off 20% of England. The figures underscores the extent of challenges confronting municipal officials across major urban centers in the next twelve months,” the analysis added.
“Local government leaders have been clear about the need for a fair and sustainable financial structure that accounts for and addresses the real levels of deprivation and demand,” said a council leader.
“Without this, councils will continue to face difficult decisions around which vital provisions to allocate spend to, and which to cut, to the detriment of their communities.”
A fifth of local authorities have cut or compromised social care provision in the last year, the survey found.
