Based on a latest poll of municipal councils, English councils are preparing to sell community centers, sports centres, and shopping arcades as they rely on a rapid disposal of properties to balance the books.
Increasing Financial Pressures Prompt Asset Sales
The Key Cities Group for major urban areas in England reported that 60% of local authorities are intending to sell assets to meet the escalating costs of adult and children’s social care.
Local governments have in the past faced criticism 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 declare themselves bankrupt.
The group said that a significant number of authorities seeking to raise money from a fire sale of assets marked “a clear change from 2024, when the largest share (60%) of local leaders stated they would focus on service redesigns and using savings to manage growing fiscal pressures.”
Detailed Examples of Planned Disposals
One local authority in Kent said its asset disposal plan included the sale of a shopping centre in Rainham and a community venue in Rochester to generate £20m over five years.
- Gillingham golf club and commercial properties owned in two English counties, which all provide rental income for the authority, will also be sold under the strategy.
Council Tax Increases and Wider Financial Strains
The survey of councils in the coalition, which includes 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 accommodation deficit.
The authority said it will proceed with asset sales after steep rises in the cost of youth support, support for vulnerable learners, elderly and disability services, and short-term housing.
“We are adopting creative strategies but certain measures require time to deliver both improved services and financial savings,” said a council leader.
He continued: “There are demographic pressures which will continue to add to the pressures we have. As a local government body, we had a 91% cut in our central funding from 2010-24, which is very challenging.”
National Trends and Forecasts
Research of county councils recently also found council budgets being strained by the growing number of young people and older individuals requiring special educational assistance.
A network of councils said that local shortfalls will reach £4.4bn a year by 2029, as they grapple to cope with rising needs.
Government officials have delayed scheduled changes to the Send system until next year after a policy document outlining those reforms was recently delayed.
Deprivation and Financial Gaps
According to the latest deprivation measures (the Index of Multiple Deprivation) covering English councils, several key cities members were among the most deprived in the country.
- “Participating urban centers like Hull, Bradford, Stoke-on-Trent, Sunderland and Wolverhampton place in the top 30 nationally under the latest IMD measures,” said the report.
“Although only one key city is among the top 10 for deprived neighbourhoods nationally, urban areas are far more likely to be in the most deprived fifth of the nation. The figures highlights the extent of difficulties facing local leaders across major urban centers in the coming year,” the analysis concluded.
“Council officials have been clear about the necessity for a equitable and lasting funding system that reflects and responds to the actual extent of disadvantage and need,” stated Michael Mordey.
“Lacking this, local authorities will persist to face impossible choices around which essential services to allocate spend to, and which to cut, to the disadvantage of their residents.”
One in five of councils have reduced or weakened social care provision in the past 12 months, the study found.
