🔗 Share this article

According to a new poll of local authorities, English councils are preparing to offload social clubs, athletic facilities, and retail spaces as they rely on a fire sale of assets to balance the books.

Growing Financial Challenges Prompt Asset Sales

The Key Cities Group representing major urban areas in the UK stated that 60% of local authorities are intending to dispose of properties to meet the rising costs of adult and children’s social care.

Councils have previously come under fire for selling public land and land to support their budgets, but they contend they must proceed to raise vital cash from property disposals or face insolvency.

This coalition said that a high proportion of authorities seeking to generate funds from a quick sale of holdings represented “a clear change from 2024, when the majority (60%) of municipal officials stated they would prioritise restructuring services and utilising financial reserves to manage increasing fiscal pressures.”

Specific Examples 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 another town to raise 20 million pounds over five years.

• Gillingham golf club and commercial properties held in Worcestershire and Suffolk, which all generate rent for Medway council, will additionally be sold under the strategy.

Local Levy Rises and Wider Financial Pressures

This research of local authorities in the coalition, which covers Sunderland, Southampton, Gloucester and Salford, also found that over seven in ten of councils will have to raise local levies next spring to address the rising cost of essential services, higher levels of homelessness, and a longstanding housing shortage.

The authority said it will press ahead with asset sales after sharp increases in the cost of children services, support for vulnerable learners, elderly and disability services, and temporary accommodation.

“We are taking innovative approaches but some of these require time to achieve both improved services and financial savings,” said a council leader.

He added: “There are population challenges which will persist to increase the strains we have. As a local government body, we had a 91% cut in our revenue support grant from over the past decade, which is very challenging.”

Countrywide Patterns and Projections

Research of regional authorities this week also found council budgets being strained by the growing number of young people and older individuals needing special educational assistance.

A network of councils said that local shortfalls will hit 4.4 billion pounds a year by the end of the decade, as they grapple to manage rising needs.

Government officials have delayed scheduled changes to the Send system until next year after a policy document outlining those reforms was recently delayed.

Deprivation and Funding Shortfalls

According to the latest deprivation measures (the Index of Multiple Deprivation) covering UK local authorities, several key cities members were among the most disadvantaged in the country.

• “Participating urban centers like several major towns rank in the top 30 across the country under the latest deprivation indices,” noted the report.

“Although only one key city 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 highlights the scale of difficulties facing local leaders across major urban centers in the next twelve months,” the report added.

“Local government leaders have been clear about the need for a equitable and lasting funding system that accounts for and addresses the actual extent of deprivation and demand,” said Michael Mordey.

“Without this, councils will continue to face impossible choices around which vital provisions to fund, and which to cut, to the disadvantage of their communities.”

A fifth of councils have cut or compromised care services in the last year, the study found.