According to a latest survey of local authorities, English councils are planning to offload community centers, sports centres, and shopping arcades as they rely on a fire sale of properties to stabilize finances.
Increasing Fiscal Challenges Prompt Asset Sales
The Key Cities Group for major urban areas in England stated that six out of ten of local authorities are planning to sell assets to cover the escalating costs of adult and children’s social care.
Councils have previously come under fire for selling public land and open spaces to shore up their budgets, but they contend they must proceed to raise vital cash from property disposals or declare themselves bankrupt.
The group noted that a significant number of councils seeking to raise money from a fire sale of assets represented “a clear change from 2024, when the largest share (60%) of local leaders said they would prioritise restructuring services and utilising savings to manage growing fiscal pressures.”
Detailed Cases of Planned Disposals
Medway Council in Kent said its property management strategy featured the disposal of a retail complex in Rainham and a community venue in another town to generate £20m over the next half-decade.
- Gillingham golf club and business parks held in two English counties, which all generate rent for Medway council, will additionally be disposed of under the plan.
Council Tax Increases and Broader Financial Strains
The survey of local authorities in the coalition, which covers Sunderland, Southampton, Gloucester and Salford, further found that more than 70% of councils will have to increase local levies next April to cover the rising cost of core provisions, increased rates of housing insecurity, and a longstanding housing shortage.
Medway council explained it will proceed with property disposals after sharp increases in the cost of children services, support for vulnerable learners, elderly and disability services, and short-term housing.
“We are adopting innovative approaches but some of these require time to achieve both improved services and financial savings,” said 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 91% cut in our revenue support grant from 2010-24, which is extremely difficult.”
Countrywide Patterns and Projections
A survey of regional authorities recently 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 reach £4.4bn a year by 2029, as they struggle to cope with rising needs.
Ministers have put off scheduled changes to the Send system until the coming year after a white paper outlining those changes has been postponed.
Disadvantage and Funding Gaps
According to the latest deprivation measures (IMD) for UK local authorities, several key cities members were included in the most disadvantaged in the country.
- “Member cities like several major towns place in the most deprived 30 across the country under the latest IMD measures,” said the study.
“Although only a single urban area is among the ten most deprived for disadvantaged communities nationally, urban areas are far more likely to be in the most deprived fifth of England. The data underscores the extent of challenges facing local leaders across key cities in the coming year,” the analysis added.
“Local government leaders have been clear about the need for a fair and sustainable financial structure that accounts for and addresses the real levels of deprivation and demand,” said Michael Mordey.
“Lacking this, councils will continue to face difficult decisions around which vital provisions to fund, and which to cut, to the detriment of their communities.”
One in five of local authorities have reduced or weakened care services in the past 12 months, the study found.
