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Based on a new study of local authorities, English councils are preparing to sell community centers, athletic facilities, and retail spaces as they bet on a fire sale of assets to stabilize finances.

Increasing Financial Pressures Prompt Asset Sales

A coalition of councils representing major urban areas in the UK reported that six out of ten of local authorities are planning to dispose of properties to cover the escalating costs of social services for vulnerable individuals.

Local governments have previously faced criticism for selling public land and open spaces to support their budgets, but they contend they must continue to generate essential revenue from asset sales or declare themselves bankrupt.

The group said that a significant number of councils seeking to generate funds from a quick sale of assets marked “a distinct shift from 2024, when the largest share (six in ten) of local leaders stated they would prioritise restructuring services and using financial reserves to manage increasing fiscal pressures.”

Detailed Cases of Planned Sales

One local authority in southeast England announced its property management strategy featured the disposal of a shopping centre in a local town and a community venue in another town to raise £20m over five years.

• A local golf course and commercial properties owned in two English counties, which all generate rent for Medway council, will also be disposed of under the plan.

Council Tax Increases and Broader Financial Pressures

This research of local authorities in the coalition, which includes Sunderland, Southampton, Gloucester and Salford, also found that over seven in ten of authorities will need to raise local levies next April to address the growing cost of core provisions, increased rates of housing insecurity, and a persistent accommodation deficit.

Medway council explained it will proceed with asset sales after steep rises in the cost of youth support, special educational needs and disability (Send) provision, elderly and disability services, and temporary accommodation.

“We are adopting creative strategies but some of these require time to achieve both improved services and cost efficiency,” stated a council leader.

He continued: “There are population challenges which will continue to increase the strains 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.”

National Trends and Forecasts

Research of regional authorities recently also found local finances being strained by the increasing figures of children and older individuals requiring Send support.

A network of councils said that council deficits will reach £4.4bn a year by 2029, as they grapple to cope with increased demand.

Government officials have put off scheduled changes to the Send system until next year after a policy document outlining those changes has been postponed.

Deprivation and Funding Gaps

Based on the most recent indices of deprivation (the Index of Multiple Deprivation) for English councils, many participating urban areas were included in the most disadvantaged in England.

• “Participating urban centers like several major towns place in the most deprived 30 nationally under the latest deprivation indices,” said the study.

“While only a single urban area is in the ten most deprived for disadvantaged communities countrywide, cities are much more prone to be in the worst-off 20% of England. The figures underscores the extent of difficulties facing local leaders across key cities in the next twelve months,” the analysis added.

“Local government leaders have been clear about the necessity for a fair and sustainable funding system that reflects and responds to the actual extent of disadvantage and need,” stated Michael Mordey.

“Lacking this, councils will continue to face difficult decisions around which essential services to fund, and which to cut, to the disadvantage of their residents.”

One in five of local authorities have cut or compromised social care provision in the last year, the survey revealed.