According to a new poll of municipal councils, UK councils are planning to sell social clubs, sports centres, and retail spaces as they rely on a rapid disposal of assets to balance the books.
Growing Financial Pressures Prompt Asset Sales
A coalition of councils representing second-tier cities in the UK reported that six out of ten of councils are planning to dispose of properties to cover the escalating costs of adult and children’s social care.
Councils have in the past come under fire for selling public land and open spaces to support their finances, but they argue they must continue to generate essential revenue from asset sales or face insolvency.
This coalition said that a high proportion of authorities seeking to generate funds from a quick sale of holdings marked “a clear change from 2024, when the majority (60%) of municipal officials said they would focus on restructuring services and utilising savings to weather growing financial challenges.”
Specific Cases of Planned Disposals
Medway Council in Kent announced its property management strategy included the sale of a shopping centre in a local town and a social club in Rochester to raise 20 million pounds over five years.
- Gillingham golf club and commercial properties held in Worcestershire and Suffolk, which all provide rental income for the authority, will also be disposed of under the plan.
Local Levy Increases and Wider Fiscal Pressures
This research of local authorities in the key cities group, which covers several urban centers, further found that over seven in ten of councils will need to raise council taxes next spring to cover the rising cost of essential services, increased rates of homelessness, and a persistent housing shortage.
Medway council said it will press ahead with property disposals after steep rises in the cost of children services, special educational needs and disability (Send) provision, adult social care, and temporary accommodation.
“We are taking creative strategies but certain measures require time to achieve both better provisions and financial savings,” stated Vince Maple.
He added: “There are demographic pressures which will continue to increase the pressures we have. As a unitary authority, we had a drastic reduction in our central funding from 2010-24, which is extremely difficult.”
National Trends and Projections
Research of regional authorities this week further found council budgets being stretched by the increasing figures of children and older individuals requiring special educational assistance.
The County Councils Network said that council deficits will hit £4.4bn a year by 2029, as they struggle to cope with rising needs.
Government officials have delayed planned reforms to the Send system until next year after a white paper setting out those reforms was recently delayed.
Deprivation and Financial Shortfalls
According to the latest indices of deprivation (the Index of Multiple Deprivation) covering English councils, many key cities members were among the most disadvantaged 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 latest IMD measures,” said the study.
“Although only a single urban area is in the ten most deprived for deprived neighbourhoods nationally, cities are far more likely to be in the worst-off 20% of the nation. The figures underscores the scale of difficulties facing local leaders across key cities in the coming year,” the report 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 need,” stated a council leader.
“Lacking this, councils will persist to face impossible choices around which vital provisions to fund, and which to cut, to the detriment of their communities.”
One in five of local authorities have cut or compromised care services in the last year, the survey found.
