Based on a new survey of municipal councils, UK councils are preparing to sell social clubs, sports centres, and shopping arcades as they bet on a rapid disposal of properties to balance the books.
Increasing Financial Challenges Prompt Asset Sales
A coalition of councils for second-tier cities in the UK stated that six out of ten of councils are intending to dispose of properties to cover the rising costs of social services for vulnerable individuals.
Local governments have previously come under fire for selling public land and open spaces to shore up their finances, but they contend they must proceed to raise vital cash from property disposals or face insolvency.
The group noted that a high proportion of councils seeking to generate funds from a quick sale of assets represented “a clear change from 2024, when the largest share (six in ten) of municipal officials said they would prioritise service redesigns and utilising savings to manage increasing financial challenges.”
Specific Examples of Proposed Disposals
Medway Council in southeast England said its asset disposal plan included the sale of a shopping centre in Rainham and a community venue in Rochester to raise £20m over five years.
- Gillingham golf club and commercial properties owned in two English counties, which all generate rent for Medway council, will additionally be sold under the plan.
Council Tax Increases and Wider Financial Pressures
This research of local authorities in the coalition, which includes several urban centers, further found that more than 70% of councils will have to raise local levies next April to cover the growing cost of core provisions, higher levels of housing insecurity, and a longstanding housing shortage.
The authority explained it will proceed with asset sales after sharp increases in the cost of children services, special educational needs and disability (Send) provision, elderly and disability services, and temporary accommodation.
“We are taking innovative approaches but certain measures require time to achieve both better provisions and financial savings,” said Vince Maple.
He continued: “There are demographic pressures which will persist to add to the pressures we have. As a unitary authority, we had a 91% cut in our central funding from 2010-24, which is extremely difficult.”
National Trends and Forecasts
Research of regional authorities this week also found local finances being strained by the growing number of young people and adults needing Send support.
A network of councils projected that local shortfalls will hit £4.4bn a year by 2029, as they grapple to cope with rising needs.
Ministers have put off planned reforms to the Send system until the coming year after a white paper outlining those changes has been postponed.
Disadvantage and Funding Shortfalls
Based on the latest deprivation measures (the Index of Multiple Deprivation) covering UK local authorities, many key cities members were included in the most disadvantaged in England.
- “Participating urban centers like several major towns place in the top 30 nationally under the 2025 deprivation indices,” noted the study.
“While only one key city is in the top 10 for disadvantaged communities countrywide, urban areas are far more likely to be in the most deprived fifth of the nation. The data underscores the scale of difficulties confronting local leaders across major urban centers in the next twelve months,” the report added.
“Council officials have been clear about the need for a fair and sustainable financial structure that accounts for and addresses the actual extent of disadvantage and need,” stated Michael Mordey.
“Lacking this, local authorities will continue to face impossible choices around which vital provisions to allocate spend to, 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 study found.
