Based on a recent study of local authorities, UK councils are planning to sell social clubs, athletic facilities, and shopping arcades as they rely on a fire sale of assets to stabilize finances.
Increasing Fiscal Pressures Drive Asset Sales
A coalition of councils for major urban areas in the UK reported that 60% of local authorities are intending to sell assets to cover the rising costs of adult and children’s social care.
Councils have in the past come under fire for selling playing fields and open spaces to shore up their budgets, but they contend they must continue to raise vital cash from asset sales or declare themselves bankrupt.
This coalition said that a significant number of authorities seeking to raise money from a fire sale of assets represented “a clear change from 2024, when the largest share (six in ten) of municipal officials said they would focus on restructuring services and using financial reserves to manage increasing fiscal pressures.”
Specific Examples of Proposed Sales
Medway Council in Kent announced its property management strategy included the sale of a shopping centre in Rainham and a community venue in Rochester to generate £20m over five years.
- A local golf course and commercial properties held in two English counties, which all provide rental income for the authority, will also be sold under the strategy.
Council Tax Increases and Broader Fiscal Strains
This research of councils in the coalition, which covers Sunderland, Southampton, Gloucester and Salford, also found that over seven in ten of authorities will have to increase council taxes next spring to cover the rising cost of core provisions, higher levels of housing insecurity, and a persistent housing shortage.
Medway council explained it will proceed with asset sales after sharp increases in the cost of children services, support for vulnerable learners, adult social care, and short-term housing.
“We are taking creative strategies but some of these require time to achieve both better provisions and financial savings,” stated Vince Maple.
He continued: “There are demographic pressures which will persist to increase the strains we have. As a local government body, we had a drastic reduction in our revenue support grant from 2010-24, which is very challenging.”
Countrywide Patterns and Forecasts
A survey of county councils recently further found council budgets being stretched by the growing number of children and older individuals requiring special educational assistance.
The County Councils Network projected that local shortfalls will reach £4.4bn a year by 2029, as they struggle to cope with increased demand.
Ministers have delayed planned reforms to the special educational needs framework until next year after a policy document setting out those reforms has been postponed.
Deprivation and Financial Shortfalls
According to the latest deprivation measures (the Index of Multiple Deprivation) covering UK local authorities, many key cities members were among the most disadvantaged in England.
- “Member cities like several major towns rank in the most deprived 30 nationally under the 2025 deprivation indices,” said the report.
“Although only one key city is among the ten most deprived for deprived neighbourhoods nationally, urban areas are much more prone to be in the most deprived fifth of England. The figures underscores the extent of challenges facing local leaders across major urban centers in the next twelve months,” the report added.
“Local government leaders have been explicit about the need for a fair and sustainable funding system that accounts for and addresses the actual extent of disadvantage and need,” stated Michael Mordey.
“Lacking this, councils will continue to face impossible choices around which essential services to allocate spend to, and which to cut, to the detriment of their residents.”
One in five of local authorities have reduced or weakened social care provision in the last year, the study revealed.
