According to a new study of local authorities, UK councils are planning to sell community centers, sports centres, and shopping arcades as they bet on a fire sale of assets to balance the books.
Increasing Fiscal Pressures Drive Asset Sales
A coalition of councils representing second-tier cities in the UK stated that 60% of local authorities are planning to sell assets to meet the rising costs of adult and children’s social care.
Local governments have in the past come under fire for disposing of playing fields and open spaces to shore up their finances, 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 assets represented “a distinct shift from 2024, when the largest share (six in ten) of municipal officials said they would focus on service redesigns and using financial reserves to manage increasing financial challenges.”
Detailed Cases of Proposed Disposals
One local authority in southeast England announced its property management strategy featured the sale of a retail complex in a local town and a community venue in Rochester to raise £20m over the next half-decade.
- A local golf course and commercial properties held in Worcestershire and Suffolk, which all generate rent for Medway council, will also be sold under the strategy.
Council Tax Rises and Wider Financial Pressures
This research of local authorities in the key cities group, which includes Sunderland, Southampton, Gloucester and Salford, also found that over seven in ten of authorities will need to raise council taxes next spring to cover the rising cost of essential services, higher levels of homelessness, and a longstanding housing shortage.
Medway council explained it will press ahead with asset sales after sharp increases in the cost of youth support, special educational needs and disability (Send) provision, adult social care, and temporary accommodation.
“We are taking creative strategies but certain measures take time to achieve both improved services and cost efficiency,” stated a council leader.
He added: “There are demographic pressures which will persist to increase the pressures we have. As a unitary authority, we had a 91% cut in our revenue support grant from over the past decade, which is very challenging.”
National Trends and Forecasts
Research of regional authorities this week further found council budgets being strained by the increasing figures of young people and adults needing special educational assistance.
The County Councils Network projected that local shortfalls will hit £4.4bn a year by the end of the decade, as they struggle to manage increased demand.
Government officials have delayed scheduled changes to the Send system until the coming year after a policy document outlining those changes was recently delayed.
Disadvantage and Funding Gaps
According to the latest deprivation measures (the Index of Multiple Deprivation) for UK local authorities, several key cities members were among the most disadvantaged in England.
- “Participating urban centers like several major towns rank in the top 30 nationally under the 2025 IMD measures,” noted the report.
“While only a single urban area is in the top 10 for disadvantaged communities countrywide, urban areas are much more prone to be in the worst-off 20% of England. The data underscores the scale of challenges confronting municipal officials across major urban centers in the coming year,” the report concluded.
“Council officials have been clear about the necessity for a equitable and lasting financial structure that accounts for and responds to the actual extent of deprivation and demand,” stated Michael Mordey.
“Lacking this, local authorities will continue to face difficult decisions around which vital provisions to fund, and which to cut, to the disadvantage of their communities.”
One in five of local authorities have reduced or weakened care services in the past 12 months, the study revealed.
