Based on a new survey of municipal councils, English councils are planning to offload social clubs, sports centres, and shopping arcades as they rely on a rapid disposal of assets to balance the books.
Growing Fiscal Challenges Prompt Asset Sales
The Key Cities Group for major urban areas in England stated that 60% of local authorities are intending to dispose of properties to cover the rising costs of adult and children’s social care.
Local governments have in the past faced criticism for disposing of public land and land to support their budgets, but they contend they must continue to generate essential revenue from property disposals or face insolvency.
The group said that a high proportion of councils attempting to generate funds from a quick sale of holdings represented “a distinct shift from 2024, when the largest share (60%) of municipal officials said they would prioritise restructuring services and utilising financial reserves to manage increasing fiscal pressures.”
Detailed Cases of Proposed Sales
One local authority in southeast England announced its asset disposal plan included the disposal of a shopping centre in Rainham and a social club in another town to raise £20m over the next half-decade.
- A local golf course and commercial properties owned in two English counties, which all provide rental income for the authority, will also be disposed of under the plan.
Council Tax Rises and Wider Financial Pressures
The survey of councils in the key cities group, which covers several urban centers, also found that more than 70% of authorities will have to increase council taxes next April to cover the rising cost of core provisions, higher levels of homelessness, and a longstanding accommodation deficit.
Medway council said it will proceed with asset sales after steep rises in the cost of youth support, special educational needs and disability (Send) provision, adult social care, and temporary accommodation.
“We are adopting innovative approaches but some of these take time to achieve both better provisions and financial savings,” said a council leader.
He continued: “We face demographic pressures which will continue to increase the strains we have. As a local government body, we had a 91% cut in our revenue support grant from 2010-24, which is very challenging.”
Countrywide Patterns and Projections
Research of regional authorities this week further found local finances being strained by the increasing figures of children and adults requiring Send support.
A network of councils said that local shortfalls will hit £4.4bn a year by the end of the decade, as they struggle to cope with rising needs.
Ministers have put off scheduled changes to the special educational needs framework until next year after a white paper setting out those reforms has been postponed.
Deprivation and Financial Shortfalls
Based on the most recent indices of deprivation (IMD) covering English councils, many participating urban areas were included in the most deprived in the country.
- “Member cities like several major towns rank in the top 30 nationally under the 2025 deprivation indices,” noted the study.
“While only one key city is in the ten most deprived for deprived neighbourhoods nationally, urban areas are far more likely to be in the worst-off 20% of the nation. The data underscores the scale of challenges confronting municipal officials across key cities in the coming year,” the analysis concluded.
“Council officials have been explicit about the need for a fair and sustainable funding system that reflects and addresses the actual extent of deprivation and demand,” said Michael Mordey.
“Without this, councils will persist to face difficult decisions around which vital provisions to allocate spend to, and which to reduce, to the disadvantage of their residents.”
One in five of local authorities have cut or compromised care services in the last year, the study found.
