Based on a recent study of local authorities, UK councils are planning to offload community centers, sports centres, and shopping arcades as they rely on a fire sale of properties to stabilize finances.
Growing Fiscal Pressures Drive Asset Sales
The Key Cities Group for second-tier cities in the UK stated that six out of ten of local authorities are intending to sell assets to meet the rising costs of adult and children’s social care.
Councils have in the past faced criticism for selling playing fields and open spaces to support their budgets, but they contend they must continue to generate essential revenue from asset sales or face insolvency.
The group said that a high proportion of councils seeking to generate funds from a fire sale of holdings represented “a distinct shift from 2024, when the largest share (six in ten) of local leaders stated they would focus on service redesigns and utilising financial reserves to manage increasing financial challenges.”
Specific Cases of Planned Sales
Medway Council in southeast England announced its asset disposal plan featured the sale of a shopping centre in a local town and a community venue in Rochester to generate £20m over five years.
- A local golf course and business parks held in two English counties, which all generate rent for the authority, will additionally be sold under the strategy.
Local Levy Rises and Broader Fiscal Pressures
This research of councils in the coalition, which includes Sunderland, Southampton, Gloucester and Salford, also found that more than 70% of councils will have to increase local levies next spring to cover the growing cost of core provisions, higher levels of homelessness, and a longstanding accommodation deficit.
Medway council explained it will proceed with property disposals after sharp increases in the cost of youth support, support for vulnerable learners, elderly and disability services, and short-term housing.
“We are taking creative strategies but some of these require time to deliver both improved services and financial savings,” said a council leader.
He continued: “There are population challenges which will continue to add to the pressures we have. As a unitary authority, we had a drastic reduction in our revenue support grant from 2010-24, which is extremely difficult.”
National Trends and Projections
Research of regional authorities this week further found council budgets being strained by the increasing figures of children and adults needing special educational assistance.
The County Councils Network said that local shortfalls will hit £4.4bn a year by 2029, as they struggle to cope with increased demand.
Government officials have delayed planned reforms to the special educational needs framework until next year after a white paper outlining those changes was recently delayed.
Disadvantage and Financial Shortfalls
According to the most recent indices of deprivation (the Index of Multiple Deprivation) covering English councils, many key cities members were among the most deprived in England.
- “Member cities like several major towns rank in the most deprived 30 across the country under the 2025 IMD measures,” said the report.
“Although only a single urban area is in the top 10 for disadvantaged communities nationally, urban areas are far more likely to be in the worst-off 20% of England. The figures highlights the extent of difficulties facing municipal officials across major urban centers in the coming year,” the report concluded.
“Local government leaders have been explicit about the need for a fair and sustainable financial structure that reflects and addresses the actual extent of deprivation and need,” said Michael Mordey.
“Lacking this, councils will persist to face difficult decisions around which vital provisions to fund, and which to cut, to the detriment of their residents.”
A fifth of local authorities have reduced or weakened social care provision in the last year, the survey found.
