According to a latest poll of municipal councils, UK councils are preparing to sell social clubs, sports centres, and shopping arcades as they rely on a fire sale of properties to stabilize finances.
Increasing Financial Challenges Prompt Asset Sales
A coalition of councils representing second-tier cities in England stated that 60% of councils are planning to dispose of properties to meet the escalating costs of adult and children’s social care.
Councils have in the past come under fire for disposing of public land and land to support their finances, but they argue they must continue to generate essential revenue from property disposals or declare themselves bankrupt.
This coalition noted that a high proportion of authorities attempting to generate funds from a fire sale of holdings represented “a distinct shift from 2024, when the largest share (six in ten) of municipal officials stated they would focus on service redesigns and utilising financial reserves to manage increasing fiscal pressures.”
Specific Examples of Planned Sales
Medway Council in southeast England said its asset disposal plan included the disposal of a shopping centre in Rainham and a community venue in another town to generate £20m over five years.
- A local golf course and commercial properties owned in two English counties, which all generate rent for the authority, will also be sold under the strategy.
Local Levy Rises and Broader Financial Pressures
The survey of councils in the coalition, which includes several urban centers, also found that more than 70% of authorities will need to raise local levies next April to cover the growing cost of core provisions, increased rates of homelessness, and a longstanding accommodation deficit.
The authority said it will proceed with property disposals after steep rises in the cost of youth support, support for vulnerable learners, elderly and disability services, and short-term housing.
“We are taking creative strategies but some of these require time to deliver both better provisions and financial savings,” said a council leader.
He added: “There are demographic pressures which will continue to add to 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 extremely difficult.”
National Trends and Projections
A survey of regional authorities recently also found council budgets being strained by the increasing figures of children and older individuals needing special educational assistance.
The County Councils Network said that council deficits will hit £4.4bn a year by 2029, as they grapple to cope with increased demand.
Government officials have delayed planned reforms to the Send system until next year after a policy document outlining those changes has been postponed.
Deprivation and Financial Shortfalls
According to the most recent deprivation measures (the Index of Multiple Deprivation) for English councils, several participating urban areas were included in the most disadvantaged in the country.
- “Member cities like Hull, Bradford, Stoke-on-Trent, Sunderland and Wolverhampton rank in the top 30 across the country under the 2025 IMD measures,” noted the report.
“Although only a single urban area is among the ten most deprived for disadvantaged communities countrywide, urban areas are far more likely to be in the worst-off 20% of England. The data highlights the scale of challenges facing municipal officials across major urban centers in the next twelve months,” the report concluded.
“Local government leaders have been clear about the need for a fair and sustainable financial structure that accounts for and addresses the real levels of deprivation and demand,” said Michael Mordey.
“Without this, local authorities will persist to face impossible choices around which vital provisions to fund, and which to reduce, to the disadvantage of their residents.”
A fifth of councils have reduced or weakened social care provision in the past 12 months, the survey revealed.
