🔗 Share this article

Based on a recent survey of local authorities, English councils are planning to sell social clubs, athletic facilities, and retail spaces as they bet on a rapid disposal of assets to stabilize finances.

Growing Financial Pressures Prompt Asset Sales

The Key Cities Group representing second-tier cities in the UK reported that six out of ten of local authorities are intending to sell assets to meet the escalating costs of adult and children’s social care.

Councils have in the past faced criticism for selling public land and open spaces to shore up their budgets, but they contend they must continue to raise vital cash from property disposals or declare themselves bankrupt.

The group noted that a significant number of councils attempting to generate funds from a fire sale of holdings represented “a clear change from 2024, when the largest share (60%) of local leaders stated they would focus on service redesigns and using savings to manage growing financial challenges.”

Detailed Cases of Planned Disposals

One local authority in Kent announced its asset disposal plan included the disposal of a retail complex in Rainham and a community venue in Rochester to generate £20m over five years.

• Gillingham golf club and business parks owned in two English counties, which all generate rent for the authority, will additionally be disposed of under the strategy.

Council Tax Increases and Wider Fiscal Pressures

The survey of councils in the coalition, which covers Sunderland, Southampton, Gloucester and Salford, further found that over seven in ten of authorities will have to increase local levies next April to cover the rising cost of essential services, increased rates of homelessness, and a persistent housing shortage.

The authority said it will press ahead with asset sales after steep rises in the cost of youth support, special educational needs and disability (Send) provision, adult social care, and short-term housing.

“We are adopting creative strategies but some of these take time to achieve both improved services and cost efficiency,” stated Vince Maple.

He continued: “There are population challenges which will continue to add to the pressures we have. As a local government body, we had a 91% cut in our revenue support grant from over the past decade, which is very challenging.”

National Patterns and Forecasts

A survey of regional authorities this week further found council budgets being stretched by the growing number of children and older individuals needing special educational assistance.

The County Councils Network projected that council deficits will hit £4.4bn a year by the end of the decade, as they struggle to manage rising needs.

Ministers have put off planned reforms to the special educational needs framework until next year after a policy document setting out those changes was recently delayed.

Deprivation and Financial Gaps

According to the most recent deprivation measures (IMD) for UK local authorities, several participating urban areas were among the most disadvantaged in England.

• “Participating urban centers like several major towns place in the most deprived 30 across the country under the latest IMD measures,” noted the study.

“While only a single urban area is in the ten most deprived for disadvantaged communities nationally, cities are much more prone to be in the worst-off 20% of the nation. The figures highlights the extent of difficulties facing local leaders across major urban centers in the coming year,” the report concluded.

“Local government leaders have been explicit about the need for a equitable and lasting funding system that accounts for and responds to the actual extent of disadvantage and need,” stated a council leader.

“Without this, local authorities will persist to face difficult decisions around which essential services to fund, and which to cut, to the detriment of their residents.”

One in five of councils have cut or compromised social care provision in the last year, the survey revealed.