Based on a latest study of municipal councils, English councils are planning to sell community centers, sports centres, and retail spaces as they bet on a rapid disposal of properties to stabilize finances.
Growing Fiscal Pressures Prompt Asset Sales
A coalition of councils representing second-tier cities in the UK reported that 60% of councils 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 disposing of playing fields and land to shore up their budgets, but they argue they must proceed to generate essential revenue from property disposals or declare themselves bankrupt.
The group noted that a high proportion of councils attempting to generate funds from a fire sale of assets marked “a distinct shift from 2024, when the largest share (60%) of local leaders said they would focus on service redesigns and utilising financial reserves to manage increasing fiscal pressures.”
Specific Cases of Planned Disposals
Medway Council in Kent announced its property management strategy included the disposal of a shopping centre in Rainham and a community venue in another town to raise £20m over five years.
- Gillingham golf club and business parks owned in Worcestershire and Suffolk, which all provide rental income for the authority, will also be disposed of under the strategy.
Council Tax Increases and Wider Financial Pressures
The survey of councils in the key cities group, which includes Sunderland, Southampton, Gloucester and Salford, also found that more than 70% of authorities will need to increase local levies next April to cover the rising cost of essential services, increased rates of housing insecurity, and a longstanding housing shortage.
The authority said it will proceed with property disposals after sharp increases in the cost of children services, special educational needs and disability (Send) provision, adult social care, and temporary accommodation.
“We are taking innovative approaches but some of these require time to deliver both improved services and cost efficiency,” stated a council leader.
He continued: “We face population challenges which will continue to increase the strains we have. As a local government body, we had a drastic reduction in our revenue support grant from over the past decade, which is very challenging.”
Countrywide Patterns and Forecasts
Research of regional authorities recently further found local finances being strained by the growing number of young people and older individuals needing special educational assistance.
The County Councils Network said that local shortfalls will reach 4.4 billion pounds a year by the end of the decade, as they grapple to cope with increased demand.
Ministers have put off planned reforms to the special educational needs framework until the coming year after a white paper setting out those changes has been postponed.
Disadvantage and Financial Shortfalls
Based on the most recent indices of deprivation (IMD) for UK local authorities, many key cities members were included in the most disadvantaged in England.
- “Member cities like several major towns rank in the top 30 across the country under the 2025 deprivation indices,” noted the report.
“Although only a single urban area is among the ten most deprived for deprived neighbourhoods nationally, cities are much more prone to be in the worst-off 20% of the nation. The figures underscores the scale of challenges facing municipal officials across key cities in the coming year,” the analysis added.
“Council officials have been explicit about the necessity for a fair and sustainable financial structure that reflects and responds to the actual extent of deprivation and need,” said Michael Mordey.
“Without this, local authorities will continue to face impossible choices around which vital provisions to fund, and which to cut, to the disadvantage of their residents.”
A fifth of councils have cut or compromised social care provision in the last year, the survey found.
