Based on a recent survey of local authorities, English councils are planning to sell community centers, sports centres, and shopping arcades as they bet on a fire sale of properties to balance the books.
Growing Financial Pressures Prompt Asset Sales
A coalition of councils representing second-tier cities in England stated that 60% of councils are planning to sell assets to cover the escalating costs of adult and children’s social care.
Councils have in the past come under fire for disposing of playing fields and land to support their budgets, but they argue they must continue to generate essential revenue from asset sales or face insolvency.
The group said that a significant number of authorities seeking to raise money from a fire sale of assets marked “a distinct shift from 2024, when the majority (60%) of local leaders stated they would focus on service redesigns and utilising financial reserves to manage growing financial challenges.”
Specific Cases of Planned Disposals
One local authority in Kent announced its asset disposal plan included the sale of a shopping centre in a local town and a social club in Rochester to raise 20 million pounds over the next half-decade.
- Gillingham golf club and business parks held in Worcestershire and Suffolk, which all generate rent for Medway council, will also be disposed of under the strategy.
Council Tax Increases and Broader Fiscal Pressures
This research of local authorities in the key cities group, which covers several urban centers, further found that over seven in ten of councils will have to raise council taxes next April to cover the growing cost of core provisions, increased rates of housing insecurity, and a persistent accommodation deficit.
The authority explained it will proceed with property disposals after steep rises in the cost of children services, special educational needs and disability (Send) provision, elderly and disability services, and short-term housing.
“We are taking innovative approaches but certain measures require time to achieve both better provisions and cost efficiency,” stated Vince Maple.
He added: “There are population challenges which will continue to add to the strains we have. As a local government body, we had a drastic reduction in our central funding from 2010-24, which is very challenging.”
National Patterns and Projections
A survey of regional authorities this week also found local finances being strained by the growing number of young people and adults requiring Send support.
The County Councils Network projected that council deficits will hit 4.4 billion pounds a year by 2029, as they grapple to manage increased demand.
Ministers have delayed planned reforms to the Send system until the coming year after a white paper setting out those changes has been postponed.
Disadvantage and Financial Gaps
Based on the most recent deprivation measures (IMD) for English councils, several participating urban areas were included in the most deprived in England.
- “Participating urban centers like Hull, Bradford, Stoke-on-Trent, Sunderland and Wolverhampton rank in the most deprived 30 nationally under the latest IMD measures,” said the study.
“While only one key city is among the top 10 for deprived neighbourhoods nationally, cities are far more likely to be in the worst-off 20% of England. The data underscores the scale of challenges confronting municipal officials across key cities in the coming year,” the report 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 demand,” stated a council leader.
“Without this, local authorities will continue to face impossible choices around which vital provisions to fund, and which to reduce, to the disadvantage of their communities.”
One in five of councils have reduced or weakened social care provision in the last year, the study revealed.
