According to a recent poll of local authorities, English councils are preparing to offload social clubs, athletic facilities, and retail spaces as they bet on a fire sale of assets to stabilize finances.
Increasing Fiscal Challenges Drive Asset Sales
The Key Cities Group for major urban areas in the UK stated that 60% of local authorities are planning to dispose of properties to cover the rising costs of social services for vulnerable individuals.
Councils have previously faced criticism for selling playing fields and open spaces to support their finances, but they argue they must continue to raise vital cash from property disposals or face insolvency.
This coalition said that a high proportion of councils seeking to raise money from a fire sale of assets marked “a distinct shift from 2024, when the largest share (60%) of municipal officials said they would prioritise service redesigns and utilising savings to weather growing fiscal pressures.”
Detailed Examples of Planned Sales
One local authority in Kent said its asset disposal plan included the sale of a retail complex in a local town and a community venue in Rochester to raise £20m over the next half-decade.
- Gillingham golf club and business parks held in Worcestershire and Suffolk, which all generate rent for the authority, will additionally be sold under the strategy.
Council Tax Increases and Broader Fiscal Pressures
The survey of councils in the coalition, which includes Sunderland, Southampton, Gloucester and Salford, further found that over seven in ten of councils will have to raise council taxes next April to address the growing cost of essential services, increased rates of housing insecurity, and a longstanding accommodation deficit.
The authority said it will press ahead with property disposals after sharp increases in the cost of children services, support for vulnerable learners, elderly and disability services, and short-term housing.
“We are adopting creative strategies but some of these take time to deliver both improved services and cost efficiency,” said a council leader.
He added: “We face population challenges which will persist to add to the pressures we have. As a local government body, we had a drastic reduction in our central funding from 2010-24, which is extremely difficult.”
Countrywide Trends and Projections
A survey of county councils recently further found council budgets being strained by the growing number of children and adults needing Send support.
A network of councils projected that local shortfalls will hit £4.4bn a year by 2029, as they struggle to cope with increased demand.
Ministers have delayed planned reforms to the special educational needs framework until next year after a white paper outlining those reforms has been postponed.
Disadvantage and Funding Shortfalls
Based on the most recent deprivation measures (the Index of Multiple Deprivation) for English councils, several participating urban areas were included in the most deprived in England.
- “Member cities like Hull, Bradford, Stoke-on-Trent, Sunderland and Wolverhampton place in the top 30 across the country under the latest IMD measures,” noted the report.
“Although only a single urban area is in the ten most deprived for deprived neighbourhoods nationally, cities are much more prone to be in the most deprived fifth of the nation. The data underscores the scale of challenges confronting municipal officials across major urban centers in the coming year,” the report concluded.
“Council officials have been explicit about the necessity for a equitable and lasting financial structure that reflects and responds to the actual extent of disadvantage and need,” stated Michael Mordey.
“Lacking this, councils will continue to face difficult decisions around which vital provisions to fund, and which to cut, to the disadvantage of their residents.”
One in five of local authorities have cut or compromised social care provision in the last year, the study found.
