Based on a latest survey of municipal councils, UK councils are planning to sell social clubs, sports centres, and shopping arcades as they rely on a fire sale of properties to stabilize finances.
Increasing Financial Challenges Prompt Asset Sales
The Key Cities Group representing second-tier cities in the UK reported that six out of ten of local authorities are intending to sell assets to cover the escalating costs of adult and children’s social care.
Councils have previously come under fire for selling playing fields and open spaces to support their budgets, but they contend they must proceed to generate essential revenue from asset sales or face insolvency.
The group noted that a significant number of authorities attempting to raise money from a quick sale of holdings represented “a distinct shift from 2024, when the majority (six in ten) of local leaders stated they would focus on restructuring services and using financial reserves to weather increasing fiscal pressures.”
Specific Examples of Proposed Sales
One local authority in Kent said its asset disposal plan featured the sale of a retail complex in Rainham and a social club in another town to generate 20 million pounds over five years.
- Gillingham golf club and business parks held in Worcestershire and Suffolk, which all generate rent for the authority, will also be disposed of under the strategy.
Council Tax Increases and Broader Fiscal Strains
The survey of local authorities in the coalition, which includes several urban centers, further found that over seven in ten of authorities will have to raise council taxes next spring to cover the rising cost of core provisions, higher levels of housing insecurity, and a longstanding housing shortage.
Medway council explained it will press ahead with asset sales after sharp increases in the cost of youth support, support for vulnerable learners, elderly and disability services, and temporary accommodation.
“We are taking creative strategies but certain measures take time to deliver both improved services and cost efficiency,” said a council leader.
He continued: “We face demographic pressures which will continue to increase the pressures we have. As a local government body, we had a drastic reduction in our revenue support grant from over the past decade, which is extremely difficult.”
National Patterns and Projections
Research of county councils this week also found council budgets being stretched by the increasing figures of young people and older individuals needing Send support.
A network of councils projected that council deficits will hit £4.4bn a year by 2029, as they grapple to manage increased demand.
Ministers have delayed planned reforms to the special educational needs framework until the coming year after a policy document outlining those changes has been postponed.
Deprivation and Financial Gaps
According to the latest indices of deprivation (the Index of Multiple Deprivation) covering English councils, several key cities members were among the most deprived in the country.
- “Participating urban centers like Hull, Bradford, Stoke-on-Trent, Sunderland and Wolverhampton place in the most deprived 30 across the country under the 2025 IMD measures,” noted the report.
“While only one key city 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 data highlights the scale of difficulties facing local leaders across key cities in the next twelve months,” the analysis concluded.
“Council officials have been clear about the need for a fair and sustainable funding system that accounts for and addresses the actual extent of disadvantage and need,” said Michael Mordey.
“Lacking this, councils will continue to face impossible choices around which essential services to fund, and which to reduce, to the disadvantage of their communities.”
One in five of councils have cut or compromised social care provision in the past 12 months, the study revealed.
