Based on a new survey of municipal councils, English councils are planning to sell community centers, athletic facilities, and retail spaces as they bet on a rapid disposal of properties to stabilize finances.
Growing Financial Challenges Prompt Asset Sales
The Key Cities Group representing second-tier cities in the UK stated that 60% of local authorities are intending to dispose of properties to cover the rising costs of social services for vulnerable individuals.
Councils have previously faced criticism for disposing of playing fields and open spaces to shore up their finances, but they argue they must continue to raise vital cash from property disposals or face insolvency.
The group said that a significant number of authorities seeking to raise money from a fire sale of holdings marked “a clear change from 2024, when the majority (60%) of local leaders stated they would prioritise service redesigns and using financial reserves to manage increasing financial challenges.”
Specific Cases of Proposed Sales
One local authority in Kent announced its property management strategy featured the disposal of a shopping centre in a local town and a community venue in Rochester to raise 20 million pounds over the next half-decade.
- Gillingham golf club and business parks owned in two English counties, which all generate rent for Medway council, will additionally be sold under the strategy.
Council Tax Increases and Broader Financial Pressures
The survey of councils in the coalition, which includes several urban centers, further found that over seven in ten of councils will need to raise council taxes next spring to address the rising cost of core provisions, higher levels of homelessness, and a longstanding accommodation deficit.
The authority said it will proceed with property disposals after sharp increases in the cost of youth support, special educational needs and disability (Send) provision, elderly and disability services, and short-term housing.
“We are adopting innovative approaches but some of these require time to deliver both better provisions and cost efficiency,” said Vince Maple.
He continued: “We face demographic pressures which will persist to increase the strains we have. As a unitary authority, we had a 91% cut in our revenue support grant from over the past decade, which is extremely difficult.”
Countrywide Patterns and Projections
A survey of county councils recently further found council budgets being strained by the increasing figures of children and older individuals needing special educational assistance.
The County Councils Network said that local shortfalls will hit £4.4bn a year by 2029, as they grapple to cope with increased demand.
Ministers have put off planned reforms to the special educational needs framework until the coming year after a policy document setting out those reforms was recently delayed.
Deprivation and Funding Gaps
According to the latest indices of deprivation (the Index of Multiple Deprivation) for English councils, several participating urban areas were included in the most disadvantaged in England.
- “Member cities like several major towns place in the top 30 across the country under the 2025 IMD measures,” noted the report.
“While only a single urban area is in the top 10 for disadvantaged communities countrywide, cities are much more prone to be in the most deprived fifth of England. The data highlights the extent of difficulties confronting municipal officials across major urban centers in the coming year,” the report concluded.
“Local government leaders have been clear about the need for a equitable and lasting financial structure that accounts for and addresses the actual extent of disadvantage and demand,” said Michael Mordey.
“Without this, councils will persist to face impossible choices around which vital provisions to allocate spend to, and which to cut, to the detriment of their communities.”
One in five of councils have cut or compromised care services in the past 12 months, the survey revealed.
