Based on a recent survey of municipal councils, English councils are planning to offload community centers, sports centres, and shopping arcades as they bet on a fire sale of properties to stabilize finances.
Increasing Fiscal Challenges Prompt Asset Sales
The Key Cities Group representing second-tier cities in the UK stated that 60% of local authorities are planning to sell assets to cover the rising costs of adult and children’s social care.
Local governments have in the past faced criticism for selling playing fields and land to support their budgets, but they argue they must proceed to raise vital cash from asset sales or face insolvency.
This coalition noted that a high proportion of councils seeking to raise money from a fire sale of holdings represented “a clear change from 2024, when the majority (60%) of local leaders said they would focus on service redesigns and using financial reserves to manage growing financial challenges.”
Specific Cases of Proposed Disposals
Medway Council in southeast England said its property management strategy featured the disposal of a shopping centre in a local town and a community venue in Rochester to generate £20m over the next half-decade.
- Gillingham golf club and business parks held in Worcestershire and Suffolk, which all provide rental income for the authority, will additionally be sold under the strategy.
Local Levy Rises and Broader Financial Strains
The survey of councils in the key cities group, which covers 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, higher levels of homelessness, and a longstanding housing shortage.
The authority explained it will press ahead with asset sales after steep rises in the cost of children services, special educational needs and disability (Send) provision, adult social care, and short-term housing.
“We are adopting innovative approaches but some of these take time to deliver both improved services and financial savings,” stated a council leader.
He continued: “There are demographic pressures which will persist to add to the strains we have. As a local government body, we had a drastic reduction in our revenue support grant from over the past decade, which is very challenging.”
Countrywide Trends and Forecasts
A survey of county councils this week further found local finances being strained by the increasing figures of young people and older individuals needing Send support.
The County Councils Network projected that council deficits will hit £4.4bn a year by 2029, as they struggle to manage increased demand.
Government officials have delayed scheduled changes to the Send system until next year after a policy document outlining those reforms has been postponed.
Disadvantage and Funding Shortfalls
According to the latest deprivation measures (IMD) for UK local authorities, many participating urban areas were included in the most deprived 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 2025 IMD measures,” noted the study.
“While only a single urban area is among the ten most deprived for deprived neighbourhoods nationally, cities are far more likely to be in the most deprived fifth of England. The data highlights the scale of difficulties facing local leaders across major urban centers in the next twelve months,” the analysis concluded.
“Local government leaders have been clear about the need for a fair and sustainable financial structure that reflects and addresses the real levels of deprivation and need,” said Michael Mordey.
“Without this, local authorities will continue to face difficult decisions around which essential services to fund, and which to cut, to the disadvantage of their communities.”
One in five of councils have cut or compromised social care provision in the last year, the study revealed.
