According to a new poll of local authorities, English councils are preparing to sell social clubs, athletic facilities, and shopping arcades as they bet on a rapid disposal of assets to stabilize finances.
Growing Fiscal Pressures Drive Asset Sales
A coalition of councils for second-tier cities in the UK reported that 60% of local authorities are intending to sell assets to meet the rising costs of social services for vulnerable individuals.
Councils have in the past come under fire for disposing of playing fields and land to shore up their budgets, but they contend they must continue to generate essential revenue from asset sales or declare themselves bankrupt.
The group said that a high proportion of authorities attempting to generate funds from a quick sale of assets marked “a clear change from 2024, when the majority (60%) of municipal officials stated they would focus on service redesigns and using financial reserves to weather increasing financial challenges.”
Detailed Cases of Proposed Sales
One local authority in southeast England said its asset disposal plan included the disposal of a shopping centre in a local town and a social club in another town to raise 20 million pounds over five years.
- Gillingham golf club and business parks owned in two English counties, which all generate rent for the authority, will also be disposed of under the plan.
Local Levy Increases and Broader Financial Strains
This research of local authorities in the coalition, which covers several urban centers, also found that more than 70% of councils will have to raise local levies next spring to cover the growing cost of essential services, higher levels of homelessness, and a persistent housing shortage.
The authority said it will press ahead with asset sales after steep rises in the cost of youth support, special educational needs and disability (Send) provision, adult social care, and temporary accommodation.
“We are adopting creative strategies but some of these take time to achieve both improved services and financial savings,” stated a council leader.
He added: “We face population challenges which will persist to add to the strains we have. As a local government body, we had a drastic reduction in our central funding from over the past decade, which is extremely difficult.”
Countrywide Patterns and Projections
A survey of regional authorities this week further found council budgets being stretched by the increasing figures of young people and older individuals requiring Send support.
A network of councils projected that council deficits will reach £4.4bn a year by the end of the decade, as they struggle to manage increased demand.
Ministers have put off planned reforms to the Send system until the coming year after a white paper outlining those changes was recently delayed.
Deprivation and Financial Shortfalls
According to the most recent deprivation measures (IMD) for UK local authorities, many key cities members were among the most disadvantaged in England.
- “Member cities like Hull, Bradford, Stoke-on-Trent, Sunderland and Wolverhampton rank in the most deprived 30 across the country under the latest IMD measures,” said the report.
“Although only a single urban area is in the top 10 for disadvantaged communities nationally, urban areas are much more prone to be in the most deprived fifth of the nation. The data underscores the extent of challenges confronting local leaders across key cities in the coming year,” the report concluded.
“Council officials have been clear about the necessity for a fair and sustainable funding system that reflects and addresses the real levels of deprivation and demand,” said Michael Mordey.
“Without this, local authorities will persist to face difficult decisions around which vital provisions to allocate spend to, and which to reduce, to the detriment of their communities.”
A fifth of local authorities have cut or compromised social care provision in the last year, the study found.
