According to a new survey of local authorities, English councils are planning to offload social clubs, sports centres, and shopping arcades as they bet on a rapid disposal of assets to stabilize finances.
Growing Fiscal Pressures Prompt Asset Sales
The Key Cities Group representing second-tier cities in England stated that 60% of councils are intending to dispose of properties to meet the rising costs of adult and children’s social care.
Local governments have previously come under fire for selling playing fields and land to support their finances, but they contend they must continue to raise vital cash from asset sales or face insolvency.
This coalition noted that a high proportion of councils seeking to raise money from a quick sale of assets marked “a distinct shift from 2024, when the largest share (60%) of local leaders stated they would prioritise restructuring services and using savings to manage growing financial challenges.”
Specific Cases of Planned Sales
One local authority in southeast England announced its asset disposal plan included the sale of a shopping centre in Rainham and a community venue in another town to raise £20m over the next half-decade.
- A local golf course and business parks owned in two English counties, which all generate rent for Medway council, will also be disposed of under the plan.
Council Tax Rises and Wider Fiscal Pressures
This research of local authorities in the coalition, which includes several urban centers, also found that more than 70% of councils will need to raise council taxes next April to address the growing cost of essential services, higher levels of housing insecurity, and a persistent housing shortage.
Medway council explained it will proceed with asset sales after steep rises in the cost of children services, special educational needs and disability (Send) provision, adult social care, and short-term housing.
“We are adopting creative strategies but some of these require time to achieve both better provisions and financial savings,” said Vince Maple.
He added: “We face population challenges which will persist to increase the strains we have. As a unitary authority, we had a 91% cut in our central funding from 2010-24, which is very challenging.”
Countrywide Trends and Forecasts
Research of county councils this week further found council budgets being stretched by the growing number of young people and older individuals requiring Send support.
The County Councils Network said that council deficits will hit £4.4bn a year by 2029, as they struggle to cope with increased demand.
Government officials have delayed scheduled changes to the Send system until next year after a white paper setting out those changes has been postponed.
Deprivation and Funding Gaps
Based on the most recent deprivation measures (the Index of Multiple Deprivation) for UK local authorities, many key cities members were included in the most deprived in England.
- “Participating urban centers like Hull, Bradford, Stoke-on-Trent, Sunderland and Wolverhampton rank in the top 30 nationally under the latest deprivation indices,” noted the report.
“While only a single urban area is among the top 10 for disadvantaged communities nationally, urban areas are far more likely to be in the worst-off 20% of England. The figures underscores the scale of difficulties confronting municipal officials across key cities in the coming year,” the report added.
“Council officials have been clear about the necessity for a fair and sustainable funding system that accounts for and addresses the actual extent of deprivation and demand,” stated a council leader.
“Lacking this, local authorities will continue to face difficult decisions around which vital provisions to allocate spend to, and which to cut, to the disadvantage of their residents.”
One in five of councils have reduced or weakened care services in the last year, the study found.
