Based on a new study of local authorities, UK councils are planning to sell social clubs, sports centres, and retail spaces as they rely on a rapid disposal of assets to balance the books.
Growing Fiscal Pressures Drive Asset Sales
A coalition of councils for second-tier cities in England stated that 60% of councils are intending to dispose of properties to cover the escalating costs of adult and children’s social care.
Councils have previously faced criticism for disposing of public land and land to shore up their budgets, but they contend they must proceed to raise vital cash from asset sales or declare themselves bankrupt.
This coalition said that a high proportion of authorities attempting to raise money from a quick sale of holdings represented “a distinct shift from 2024, when the majority (six in ten) of local leaders said they would prioritise service redesigns and using financial reserves to weather growing financial challenges.”
Detailed Examples of Planned Sales
One local authority in Kent said its asset disposal plan featured the sale of a retail complex in Rainham and a community venue in another town to generate £20m over five years.
- Gillingham golf club and commercial properties owned in two English counties, which all generate rent for the authority, will additionally be sold under the strategy.
Council Tax Rises and Wider Fiscal Pressures
The survey of local authorities in the key cities group, which includes Sunderland, Southampton, Gloucester and Salford, also found that more than 70% of councils will have to raise local levies next spring to address the growing cost of essential services, increased rates of housing insecurity, and a persistent housing shortage.
The authority explained it will proceed with asset sales after sharp increases in the cost of children services, special educational needs and disability (Send) provision, adult social care, and short-term housing.
“We are adopting creative strategies but some of these require time to achieve both improved services and financial savings,” said a council leader.
He added: “We face demographic pressures which will persist to add to the pressures we have. As a unitary authority, we had a 91% cut in our revenue support grant from 2010-24, which is extremely difficult.”
National Trends and Forecasts
A survey of county councils this week further found council budgets being strained by the growing number of young people and older individuals needing Send support.
A network of councils projected that council deficits will reach 4.4 billion pounds a year by the end of the decade, as they struggle to cope with increased demand.
Ministers have put off planned reforms to the Send system until next year after a white paper outlining those changes has been postponed.
Disadvantage and Financial Shortfalls
According to the latest deprivation measures (IMD) for English councils, several key cities members were among the most disadvantaged in England.
- “Member cities like Hull, Bradford, Stoke-on-Trent, Sunderland and Wolverhampton place in the top 30 across the country under the 2025 IMD measures,” noted the study.
“While only one key city is in the ten most deprived for disadvantaged communities countrywide, urban areas are much more prone to be in the most deprived fifth of the nation. The data highlights the scale of difficulties facing local leaders across major urban centers in the coming year,” the report concluded.
“Council officials have been explicit about the necessity for a fair and sustainable funding system that reflects and addresses the actual extent of deprivation and demand,” said a council leader.
“Without this, councils will continue to face impossible choices around which essential services to allocate spend to, and which to reduce, to the detriment of their residents.”
One in five of local authorities have cut or compromised care services in the past 12 months, the survey revealed.
