According to a new poll of local authorities, English councils are preparing to sell social clubs, athletic facilities, and retail spaces as they rely on a fire sale of properties to balance the books.
Increasing Fiscal Challenges Prompt Asset Sales
A coalition of councils for second-tier cities in England stated that six out of ten of local authorities are planning to dispose of properties to meet the escalating costs of adult and children’s social care.
Councils have previously faced criticism for disposing of playing fields and open spaces to support their finances, but they argue they must continue to raise vital cash from property disposals or declare themselves bankrupt.
The group noted that a high proportion of councils attempting to raise money from a fire sale of holdings represented “a clear change from 2024, when the largest share (60%) of local leaders stated they would prioritise restructuring services and using savings to weather growing financial challenges.”
Detailed Examples of Proposed Disposals
Medway Council in Kent announced its asset disposal plan featured the sale of a retail complex in Rainham and a social club in Rochester to generate 20 million pounds over five years.
- Gillingham golf club and commercial properties held in Worcestershire and Suffolk, which all generate rent for the authority, will additionally be sold under the strategy.
Council Tax Increases and Wider Fiscal Strains
The survey of councils in the coalition, which includes Sunderland, Southampton, Gloucester and Salford, also found that over seven in ten of councils will need to increase local levies next spring to address the rising cost of core provisions, increased rates of homelessness, and a persistent housing shortage.
The authority said 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 short-term housing.
“We are taking creative strategies but certain measures take time to deliver both improved services and cost efficiency,” said Vince Maple.
He continued: “There are demographic pressures which will persist to increase 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 Patterns and Projections
A survey of regional authorities this week further found local finances being strained by the growing number of young people and adults requiring Send support.
A network of councils said that council deficits will reach £4.4bn a year by 2029, as they grapple to manage rising needs.
Ministers have put off scheduled changes to the special educational needs framework until next year after a policy document outlining those reforms has been postponed.
Disadvantage and Funding Shortfalls
Based on the latest deprivation measures (IMD) covering English councils, many key cities members were included in the most disadvantaged in England.
- “Participating urban centers like several major towns place in the top 30 nationally under the latest IMD measures,” noted the report.
“Although only one key city is in the top 10 for disadvantaged communities nationally, cities are much more prone to be in the worst-off 20% of the nation. The data highlights the scale of challenges facing local leaders across key cities in the coming year,” the analysis concluded.
“Local government leaders have been explicit about the necessity for a equitable and lasting financial structure that accounts for and responds to the real levels of disadvantage and need,” said a council leader.
“Lacking this, councils will persist to face impossible choices around which essential services to fund, and which to reduce, to the detriment of their communities.”
One in five of councils have cut or compromised care services in the last year, the study found.
