According to a new poll of local authorities, English councils are planning to offload community centers, sports centres, and retail spaces as they rely on a fire sale of assets to stabilize finances.
Increasing Financial Challenges Prompt Asset Sales
A coalition of councils for second-tier cities in England stated that six out of ten of councils are planning to sell assets to cover the escalating costs of social services for vulnerable individuals.
Local governments have previously faced criticism for selling public land and land to shore up their budgets, but they contend they must continue to generate essential revenue from property disposals or declare themselves bankrupt.
This coalition said that a high proportion of councils seeking to raise money from a fire sale of assets marked “a clear change from 2024, when the majority (six in ten) of local leaders said they would prioritise restructuring services and using financial reserves to weather growing financial challenges.”
Detailed Cases of Planned Disposals
Medway Council in Kent said its asset disposal plan included the disposal of a retail complex in Rainham and a community venue in another town to generate £20m over five years.
- Gillingham golf club and commercial properties held in two English counties, which all generate rent for the authority, will additionally be disposed of under the strategy.
Council Tax Rises and Broader Fiscal Strains
This research of local authorities in the key cities group, which covers several urban centers, also found that over seven in ten of councils will have to increase local levies next spring to address the rising cost of essential services, higher levels of housing insecurity, and a persistent accommodation deficit.
The authority explained it will press ahead with asset sales after sharp increases in the cost of youth support, support for vulnerable learners, adult social care, and short-term housing.
“We are taking innovative approaches but some of these take time to deliver both improved services and financial savings,” stated a council leader.
He added: “We face population challenges which will persist to increase the strains we have. As a local government body, we had a drastic reduction in our central funding from over the past decade, which is very challenging.”
National Trends and Forecasts
A survey of regional authorities recently further found local finances being strained by the increasing figures of children and adults needing special educational assistance.
A network of councils said that council deficits will hit £4.4bn a year by the end of the decade, as they struggle to cope with rising needs.
Government officials have delayed scheduled changes to the Send system until next year after a policy document setting out those reforms has been postponed.
Deprivation and Funding Shortfalls
Based on the latest indices of deprivation (the Index of Multiple Deprivation) covering English councils, several key cities members were included in the most disadvantaged in the country.
- “Member cities like several major towns place in the most deprived 30 nationally under the 2025 IMD measures,” noted the report.
“While only a single urban area is in the top 10 for disadvantaged communities nationally, urban areas are much more prone to be in the most deprived fifth of England. The figures underscores the scale of challenges confronting local leaders across key cities in the coming year,” the analysis concluded.
“Council officials have been explicit about the necessity for a equitable and lasting financial structure that accounts for and responds to the actual extent of deprivation and demand,” stated Michael Mordey.
“Lacking this, councils will continue to face impossible choices around which vital provisions to fund, and which to reduce, to the detriment of their communities.”
One in five of councils have reduced or weakened social care provision in the past 12 months, the study revealed.
