According to a latest survey of local authorities, UK councils are preparing to offload community centers, sports centres, and retail spaces as they rely on a fire sale of assets to balance the books.
Growing Financial Challenges Drive Asset Sales
A coalition of councils for second-tier cities in the UK stated that six out of ten of local authorities are intending to sell assets to meet the rising costs of social services for vulnerable individuals.
Local governments have in the past come under fire for disposing of public land and open spaces to shore up their finances, but they argue they must proceed to generate essential revenue from property disposals or face insolvency.
This coalition said that a high proportion of authorities attempting to raise money from a fire sale of assets marked “a distinct shift from 2024, when the largest share (60%) of local leaders said they would prioritise restructuring services and using savings to weather growing financial challenges.”
Detailed Cases of Proposed Disposals
Medway Council in Kent announced its asset disposal plan included the disposal of a shopping centre in Rainham and a community venue in Rochester to raise £20m over the next half-decade.
- Gillingham golf club and business parks owned in two English counties, which all provide rental income for the authority, will also be sold under the strategy.
Local Levy Rises and Broader Fiscal Pressures
The survey of local authorities in the coalition, which covers Sunderland, Southampton, Gloucester and Salford, further found that more than 70% of authorities will have to raise council taxes next April to cover the rising cost of essential services, increased rates of housing insecurity, and a longstanding accommodation deficit.
The authority said it will press ahead 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 require time to deliver both better provisions and cost efficiency,” said Vince Maple.
He continued: “There are population challenges which will continue to add to the strains we have. As a unitary authority, we had a drastic reduction in our central funding from 2010-24, which is very challenging.”
National Trends and Forecasts
A survey of county councils recently also found local finances being stretched by the increasing figures of children and adults needing Send support.
The County Councils Network projected that local shortfalls will reach £4.4bn a year by the end of the decade, as they struggle to cope with rising needs.
Government officials have put off scheduled changes to the Send system until the coming year after a policy document setting out those changes has been postponed.
Disadvantage and Financial Gaps
Based on the most recent deprivation measures (IMD) covering UK local authorities, many key cities members were among the most deprived in England.
- “Member cities like several major towns rank in the most deprived 30 across the country under the 2025 IMD measures,” noted the report.
“While only one key city is in the ten most deprived for deprived neighbourhoods countrywide, urban areas are much more prone to be in the worst-off 20% of the nation. The figures underscores the scale of difficulties confronting municipal officials across major urban centers in the coming year,” the analysis added.
“Council officials have been clear about the necessity for a equitable and lasting funding system that accounts for and addresses the actual extent of deprivation and demand,” stated Michael Mordey.
“Without this, local authorities will continue to face impossible choices around which vital provisions to allocate spend to, and which to reduce, to the detriment of their communities.”
One in five of local authorities have cut or compromised social care provision in the past 12 months, the survey found.
