Based on a new study of municipal councils, UK councils are preparing to offload social clubs, sports centres, and retail spaces as they rely on a fire sale of assets to balance the books.
Increasing Financial Challenges Drive Asset Sales
A coalition of councils for major urban areas 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.
Local governments have previously faced criticism for disposing of playing fields and land to shore up their budgets, but they contend they must proceed to raise vital cash from asset sales or face insolvency.
The group said that a significant number of authorities attempting to generate funds from a fire sale of assets marked “a clear change from 2024, when the majority (six in ten) of local leaders stated they would focus on restructuring services and using financial reserves to manage increasing fiscal pressures.”
Detailed Examples of Proposed Disposals
One local authority in southeast England said its property management strategy included the sale of a shopping centre in Rainham and a social club in Rochester to generate £20m over the next half-decade.
- Gillingham golf club and commercial properties owned in two English counties, which all generate rent for the authority, will also be sold under the plan.
Council Tax Rises and Broader Fiscal Strains
This research of councils in the key cities group, which includes Sunderland, Southampton, Gloucester and Salford, further found that more than 70% of councils will have to increase local levies next spring to cover the growing cost of core provisions, increased rates of housing insecurity, and a longstanding housing shortage.
Medway council said it will proceed with property disposals after steep rises in the cost of children services, special educational needs and disability (Send) provision, adult social care, and temporary accommodation.
“We are adopting creative strategies but certain measures take time to achieve both better provisions and cost efficiency,” stated Vince Maple.
He continued: “We face population challenges which will continue to add to the strains we have. As a unitary authority, we had a drastic reduction in our revenue support grant from 2010-24, which is extremely difficult.”
Countrywide Trends and Projections
A survey of county councils this week also found council budgets being strained by the growing number of children and adults requiring Send support.
The County Councils Network projected that local shortfalls will reach £4.4bn a year by the end of the decade, as they grapple to manage rising needs.
Government officials have delayed planned reforms to the Send system until next year after a policy document outlining those changes has been postponed.
Deprivation and Funding Shortfalls
Based on the most recent deprivation measures (IMD) covering UK local authorities, many key cities members were among the most disadvantaged in the country.
- “Member cities like several major towns rank in the top 30 nationally under the 2025 deprivation indices,” said the report.
“While only one key city is among the top 10 for disadvantaged communities nationally, cities are much more prone to be in the most deprived fifth of England. The figures underscores the extent of difficulties facing municipal officials across major urban centers in the next twelve months,” the analysis added.
“Council officials have been clear about the need for a equitable and lasting financial structure that reflects and addresses the actual extent of deprivation and need,” said a council leader.
“Without this, councils will continue to face impossible choices around which essential services to allocate spend to, and which to cut, to the disadvantage of their communities.”
A fifth of councils have reduced or weakened care services in the last year, the survey found.
