Based on a new study of local authorities, UK councils are preparing to sell social clubs, sports centres, and retail spaces as they rely on a fire sale of properties to balance the books.
Growing Financial Challenges Drive Asset Sales
The Key Cities Group representing second-tier cities in the UK reported that 60% of councils are planning to sell assets to meet the rising costs of adult and children’s social care.
Councils have previously come under fire for selling public land and land to shore up their finances, but they argue they must continue to generate essential revenue from asset sales or declare themselves bankrupt.
This coalition noted that a high proportion of authorities attempting to generate funds from a quick sale of assets represented “a distinct shift from 2024, when the largest share (60%) of municipal officials stated they would focus on restructuring services and using financial reserves to manage growing financial challenges.”
Specific Examples of Proposed Sales
Medway Council in Kent said its property management strategy featured the disposal of a shopping centre in Rainham and a community venue in Rochester to generate £20m over the next half-decade.
- Gillingham golf club and commercial properties held in Worcestershire and Suffolk, which all provide rental income for the authority, will additionally be sold under the strategy.
Council Tax Rises and Wider Financial Strains
This research of local authorities in the coalition, which includes several urban centers, further found that more than 70% of authorities will need to increase council taxes next April to cover the rising cost of essential services, higher levels of homelessness, and a persistent housing shortage.
Medway council said it will press ahead with asset sales after steep rises in the cost of children services, support for vulnerable learners, adult social care, and temporary accommodation.
“We are adopting innovative approaches but some of these take time to achieve both improved services and cost efficiency,” stated Vince Maple.
He added: “We face demographic pressures which will continue to add to the strains we have. As a unitary authority, we had a drastic reduction in our revenue support grant from 2010-24, which is very challenging.”
National Trends and Forecasts
A survey of county councils recently also found council budgets being stretched by the increasing figures of children and adults requiring Send support.
The County Councils Network projected that local shortfalls will reach 4.4 billion pounds a year by the end of the decade, as they grapple to cope with increased demand.
Government officials have put off planned reforms to the Send system until next year after a policy document outlining those reforms has been postponed.
Disadvantage and Financial Shortfalls
Based on the most recent indices of deprivation (IMD) covering English councils, several participating urban areas were included in the most deprived in England.
- “Member cities like several major towns place in the most deprived 30 across the country under the 2025 deprivation indices,” noted the report.
“Although only a single urban area is among the top 10 for disadvantaged communities nationally, cities are much more prone to be in the most deprived fifth of England. The figures underscores the scale of challenges confronting local leaders across key cities in the coming year,” the report added.
“Local government leaders have been clear about the necessity for a fair and sustainable financial structure that reflects and responds to the real levels of disadvantage and demand,” said a council leader.
“Without this, councils will persist to face impossible choices around which essential services to fund, and which to cut, to the detriment of their communities.”
One in five of councils have cut or compromised social care provision in the past 12 months, the survey found.
