According to a new poll of local authorities, UK councils are preparing to sell social clubs, athletic facilities, and shopping arcades as they rely on a fire sale of assets to balance the books.
Increasing Fiscal Challenges Drive Asset Sales
The Key Cities Group representing major urban areas in the UK reported that six out of ten of local authorities are intending to dispose of properties to meet the rising costs of adult and children’s social care.
Local governments have previously faced criticism for disposing of public land and land to support their finances, but they contend they must continue to raise vital cash from property disposals or face insolvency.
This coalition said that a high proportion of councils attempting to generate funds from a quick sale of holdings represented “a distinct shift from 2024, when the largest share (six in ten) of local leaders stated they would focus on restructuring services and using financial reserves to weather increasing fiscal pressures.”
Specific Examples of Planned Disposals
Medway Council in southeast England said its property management strategy included the disposal of a shopping centre in a local town and a community venue in Rochester to raise £20m over the next half-decade.
- A local golf course and business parks owned in two English counties, which all provide rental income for Medway council, will also be disposed of under the plan.
Council Tax Increases and Wider Financial Strains
The survey of councils in the key cities group, which covers Sunderland, Southampton, Gloucester and Salford, further found that over seven in ten of authorities will have to increase local levies next April to address the rising cost of core provisions, increased rates of housing insecurity, and a longstanding accommodation deficit.
The authority explained it will press ahead with property disposals 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 take time to achieve both improved services and cost efficiency,” stated Vince Maple.
He added: “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 over the past decade, which is extremely difficult.”
Countrywide Trends and Forecasts
Research of county councils this week further found council budgets being stretched by the increasing figures of young people and older individuals needing special educational assistance.
The County Councils Network said that council deficits will reach 4.4 billion pounds a year by the end of the decade, as they struggle to manage rising needs.
Ministers have delayed planned reforms to the special educational needs framework until next year after a white paper setting out those changes was recently delayed.
Deprivation and Funding Gaps
Based on the most recent deprivation measures (IMD) covering UK local authorities, several key cities members were among the most deprived in England.
- “Member cities like several major towns rank in the top 30 across the country under the 2025 IMD measures,” noted 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 worst-off 20% of the nation. The data underscores the extent of difficulties facing local leaders across key cities in the coming year,” the report added.
“Council officials have been clear about the necessity for a fair and sustainable funding system that accounts for and addresses the real levels of disadvantage and demand,” stated Michael Mordey.
“Without this, local authorities will continue to face difficult decisions around which vital provisions to fund, and which to reduce, to the detriment of their residents.”
A fifth of councils have reduced or weakened care services in the last year, the study revealed.
