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According to a recent study of local authorities, UK councils are planning to sell community centers, sports centres, and retail spaces as they bet on a fire sale of assets to balance the books.

Increasing Fiscal Challenges Prompt Asset Sales

The Key Cities Group for major urban areas in England reported that 60% of councils are intending to sell assets to cover the rising costs of adult and children’s social care.

Local governments have in the past faced criticism for disposing of public land and land to support their budgets, but they argue they must continue 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 quick sale of assets represented “a clear change from 2024, when the largest share (60%) of local leaders said they would prioritise service redesigns and utilising financial reserves to weather growing fiscal pressures.”

Detailed Examples of Planned Disposals

One local authority in southeast England said its property management strategy included the sale of a shopping centre in Rainham and a social club in another town to raise £20m over five years.

• A local golf course and commercial properties held in Worcestershire and Suffolk, which all generate rent for the authority, will also be sold under the strategy.

Council Tax Increases and Wider Financial Pressures

This research of local authorities in the key cities group, which covers several urban centers, also found that more than 70% of authorities will have to raise council taxes next spring to address the growing cost of core provisions, higher levels of housing insecurity, and a persistent accommodation deficit.

Medway council said it will proceed with property disposals after sharp increases 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 require time to deliver both better provisions and cost efficiency,” said Vince Maple.

He continued: “We face demographic pressures which will continue to increase the pressures we have. As a unitary authority, we had a 91% cut in our revenue support grant from over the past decade, which is extremely difficult.”

Countrywide Trends and Projections

A survey of county councils this week further found council budgets being strained by the increasing figures of children and older individuals requiring Send support.

A network of councils projected that council deficits will hit 4.4 billion pounds a year by 2029, as they struggle to manage increased demand.

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

Disadvantage and Financial Gaps

Based on the latest deprivation measures (the Index of Multiple Deprivation) covering English councils, several participating urban areas were included in the most deprived in the country.

• “Member cities like several major towns rank in the most deprived 30 across the country under the latest deprivation indices,” noted the report.

“Although only a single urban area is in the top 10 for deprived neighbourhoods countrywide, urban areas are far more likely to be in the most deprived fifth of the nation. The data highlights the extent of difficulties facing municipal officials across major urban centers in the next twelve months,” the analysis concluded.

“Local government leaders have been clear about the necessity for a fair and sustainable funding system that accounts for and responds to the real levels of deprivation and demand,” said a council leader.

“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 care services in the past 12 months, the study revealed.