According to a recent study of local authorities, UK councils are preparing to sell social clubs, athletic facilities, and shopping arcades as they rely on a rapid disposal of properties to balance the books.
Increasing Financial Pressures Drive Asset Sales
A coalition of councils representing major urban areas in England reported that 60% of councils are planning to dispose of properties to meet the rising costs of adult and children’s social care.
Local governments have previously come under fire for selling public land and land to support their budgets, but they argue they must continue to generate essential revenue from property disposals or declare themselves bankrupt.
The group noted that a high proportion of authorities attempting to raise money from a fire sale of assets represented “a clear change from 2024, when the largest share (six in ten) of local leaders said they would prioritise service redesigns and utilising savings to weather growing fiscal pressures.”
Specific Examples of Planned Sales
One local authority in southeast England announced its asset disposal plan featured the disposal of a shopping centre in a local town and a social club in Rochester to raise £20m over five years.
- Gillingham golf club and commercial properties held in Worcestershire and Suffolk, which all generate rent for the authority, will additionally be sold under the plan.
Council Tax Rises and Broader Fiscal Strains
This research of local authorities in the key cities group, which includes several urban centers, also found that over seven in ten of authorities will have to increase local levies next April to cover the growing cost of essential services, higher levels of housing insecurity, and a longstanding accommodation deficit.
The authority explained it will press ahead with property disposals after steep rises in the cost of children services, support for vulnerable learners, elderly and disability services, and short-term housing.
“We are taking creative strategies but some of these require time to achieve both better provisions and cost efficiency,” said Vince Maple.
He added: “There are demographic pressures which will continue to increase the pressures we have. As a local government body, we had a drastic reduction in our revenue support grant from over the past decade, which is extremely difficult.”
National Trends and Projections
Research of county councils recently further found local finances being strained by the growing number of young people and older individuals requiring Send support.
The County Councils Network said that council deficits will hit 4.4 billion pounds 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 white paper outlining those changes was recently delayed.
Disadvantage and Financial Gaps
According to the latest indices of deprivation (IMD) for UK local authorities, several key cities members were included in 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 deprivation indices,” said the study.
“Although only a single urban area is among the top 10 for deprived neighbourhoods countrywide, urban areas are much more prone to be in the worst-off 20% of the nation. The data highlights the scale of difficulties confronting municipal officials across major urban centers in the next twelve months,” the analysis added.
“Local government leaders have been clear about the need for a equitable and lasting financial structure that accounts for and addresses the real levels of disadvantage and demand,” said Michael Mordey.
“Lacking this, councils will continue to face difficult decisions around which essential services to fund, and which to reduce, to the disadvantage of their residents.”
A fifth of local authorities have cut or compromised social care provision in the last year, the study found.
