According to a recent survey of municipal councils, English councils are planning to offload community centers, sports centres, and retail spaces as they bet on a rapid disposal of assets to stabilize finances.
Growing Financial Pressures Prompt Asset Sales
The Key Cities Group for second-tier cities in England reported that six out of ten of local authorities are intending to dispose of properties to cover the rising costs of adult and children’s social care.
Local governments have in the past faced criticism for selling public land and land to support their budgets, but they contend they must proceed to generate essential revenue from property disposals or face insolvency.
The group said that a high proportion of councils seeking to generate funds from a quick sale of assets represented “a distinct shift from 2024, when the largest share (60%) of local leaders said they would focus on restructuring services and using savings to weather increasing financial challenges.”
Detailed Cases of Proposed Disposals
One local authority in Kent said its asset disposal plan featured the disposal of a retail complex in Rainham and a social club in Rochester to generate £20m over five years.
- Gillingham golf club and business parks owned in two English counties, which all generate rent for Medway council, will also be sold under the plan.
Council Tax Increases and Wider Fiscal Pressures
This research of local authorities in the key cities group, which covers Sunderland, Southampton, Gloucester and Salford, further found that more than 70% of councils will have to increase local levies next spring to address the growing cost of core provisions, increased rates of homelessness, and a persistent accommodation deficit.
Medway council explained it will proceed with property disposals after sharp increases 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 some of these require time to achieve both better provisions and financial savings,” stated Vince Maple.
He added: “We face population challenges which will continue to add to the pressures we have. As a unitary authority, we had a drastic reduction in our central funding from over the past decade, which is extremely difficult.”
National Patterns and Forecasts
Research of county councils recently also found council budgets being strained by the growing number of young people and adults needing special educational assistance.
The County Councils Network said that council deficits will reach £4.4bn a year by the end of the decade, as they grapple to cope with rising needs.
Ministers have delayed planned reforms to the special educational needs framework until next year after a white paper setting out those reforms has been postponed.
Disadvantage and Funding Shortfalls
Based on the most recent deprivation measures (IMD) for English councils, several key cities members were among the most deprived in England.
- “Participating urban centers like several major towns place in the most deprived 30 across the country under the 2025 deprivation indices,” said the study.
“Although only one key city is in the top 10 for disadvantaged communities countrywide, urban areas are much more prone to be in the worst-off 20% of the nation. The data highlights the scale 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 accounts for and addresses the actual extent of deprivation and demand,” stated Michael Mordey.
“Without this, local authorities will continue to face difficult decisions around which essential services to fund, and which to cut, to the disadvantage of their residents.”
A fifth of local authorities have reduced or weakened care services in the past 12 months, the study revealed.
