According to a new poll of local authorities, UK councils are planning to sell community centers, athletic facilities, and retail spaces as they rely on a fire sale of assets to stabilize finances.
Growing Financial Pressures Drive Asset Sales
A coalition of councils representing second-tier cities in the UK stated that six out of ten of councils are planning to sell assets to cover the rising costs of adult and children’s social care.
Councils have previously come under fire for disposing of playing fields and land to support their finances, but they contend they must continue to generate essential revenue from property disposals or declare themselves bankrupt.
This coalition noted that a high proportion of councils seeking to generate funds from a quick sale of assets marked “a distinct shift from 2024, when the majority (six in ten) of municipal officials said they would prioritise restructuring services and utilising savings to weather increasing financial challenges.”
Specific Examples of Planned Disposals
Medway Council in Kent announced its asset disposal plan included the disposal of a shopping centre in Rainham and a community venue in another town to raise 20 million pounds over the next half-decade.
- Gillingham golf club and business parks owned in Worcestershire and Suffolk, which all generate rent for the authority, will additionally be disposed of under the strategy.
Council Tax Rises and Wider Financial Strains
This research of councils in the coalition, which includes Sunderland, Southampton, Gloucester and Salford, also found that more than 70% of authorities will have to raise local levies next spring to cover the growing cost of core provisions, higher levels of housing insecurity, and a persistent housing shortage.
The authority explained it will proceed with property disposals after steep rises in the cost of youth support, support for vulnerable learners, 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 added: “We face population challenges which will continue to increase the pressures we have. As a local government body, we had a 91% cut in our central funding from over the past decade, which is very challenging.”
Countrywide Trends and Forecasts
A survey of county councils this week further found council budgets being strained by the increasing figures of young people and adults requiring special educational assistance.
The County Councils Network said that local shortfalls will reach 4.4 billion pounds a year by 2029, as they struggle to cope with rising needs.
Ministers have put off planned reforms to the Send system until the coming year after a white paper setting out those changes has been postponed.
Disadvantage and Funding Gaps
According to the latest deprivation measures (IMD) covering English councils, several key cities members were among the most disadvantaged in England.
- “Participating urban centers like Hull, Bradford, Stoke-on-Trent, Sunderland and Wolverhampton rank in the top 30 nationally under the latest IMD measures,” said the report.
“Although only one key city is among the ten most deprived for deprived neighbourhoods nationally, cities are far more likely to be in the worst-off 20% of England. The data highlights the scale of difficulties confronting local leaders across key cities in the coming year,” the analysis concluded.
“Local government leaders have been explicit about the need for a equitable and lasting funding system that accounts for and responds to the real levels of deprivation and demand,” said a council leader.
“Lacking this, councils will persist to face difficult decisions around which essential services to fund, and which to cut, to the detriment of their residents.”
A fifth of councils have reduced or weakened social care provision in the last year, the survey found.
