According to a new poll of municipal councils, English councils are preparing to sell community centers, sports centres, and shopping arcades as they bet on a rapid disposal of assets to stabilize finances.
Growing Financial Challenges Drive Asset Sales
The Key Cities Group representing second-tier cities in England reported that 60% of local authorities are intending to dispose of properties to cover the escalating costs of adult and children’s social care.
Local governments have in the past come under fire for disposing of public land and land to support their finances, but they contend they must proceed to generate essential revenue from property disposals or face insolvency.
The group noted that a high proportion of authorities attempting to generate funds from a fire sale of assets marked “a distinct shift from 2024, when the largest share (six in ten) of local leaders stated they would focus on service redesigns and using financial reserves to weather increasing financial challenges.”
Specific Examples of Planned Disposals
One local authority in southeast England said its property management strategy featured the sale of a shopping centre in Rainham and a social club in another town to generate £20m over five years.
- A local golf course and business parks owned in Worcestershire and Suffolk, which all generate rent for Medway council, will additionally be sold under the plan.
Council Tax Increases and Broader Fiscal Strains
The survey of councils in the coalition, which includes Sunderland, Southampton, Gloucester and Salford, further found that over seven in ten of councils will need to increase council taxes next April to cover the rising cost of essential services, higher levels of homelessness, and a persistent housing shortage.
The authority explained it will press ahead with asset sales after steep rises in the cost of youth support, special educational needs and disability (Send) provision, elderly and disability services, and short-term housing.
“We are taking innovative approaches but certain measures take time to deliver both improved services and cost efficiency,” said a council leader.
He continued: “There are demographic pressures which will continue to add to the strains we have. As a unitary authority, we had a 91% cut in our central funding from over the past decade, which is very challenging.”
National Trends and Projections
A survey of county councils this week also found council budgets being strained by the increasing figures of young people and adults needing special educational assistance.
The County Councils Network said that council deficits will hit 4.4 billion pounds a year by the end of the decade, as they struggle to cope with rising needs.
Government officials have put off planned reforms to the special educational needs framework until next year after a policy document outlining those changes has been postponed.
Deprivation and Funding Gaps
According to the latest indices of deprivation (IMD) for UK local authorities, many participating urban areas were among the most deprived in England.
- “Participating urban centers like several major towns rank in the most deprived 30 nationally under the 2025 deprivation indices,” noted the report.
“Although only one key city is among the ten most deprived for deprived neighbourhoods nationally, cities are far more likely to be in the worst-off 20% of England. The figures underscores the extent of difficulties facing municipal officials across key cities in the coming year,” the analysis concluded.
“Council officials have been clear about the need for a equitable and lasting financial structure that reflects and addresses the actual extent of deprivation and demand,” said Michael Mordey.
“Without this, councils will continue to face difficult decisions around which essential services to fund, and which to reduce, to the detriment of their residents.”
One in five of councils have cut or compromised social care provision in the last year, the study found.
