According to a new study of municipal councils, UK councils are preparing to offload community centers, athletic facilities, and shopping arcades as they bet on a fire sale of assets to balance the books.
Growing Fiscal Challenges Drive Asset Sales
The Key Cities Group representing major urban areas in England reported that six out of ten of local authorities are intending to dispose of properties to meet the escalating costs of adult and children’s social care.
Councils have previously come under fire for disposing of playing fields 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 significant number of councils attempting to raise money from a quick sale of assets marked “a clear change from 2024, when the majority (60%) of local leaders stated they would prioritise service redesigns and using financial reserves to manage increasing financial challenges.”
Detailed Examples of Proposed Disposals
Medway Council in southeast England announced its asset disposal plan featured the disposal of a shopping centre in Rainham and a social club in Rochester to generate £20m over five years.
- A local golf course and commercial properties owned in two English counties, which all provide rental income for Medway council, will additionally be disposed of under the plan.
Local Levy Increases and Wider Fiscal Pressures
This research of local authorities in the key cities group, which covers several urban centers, further found that more than 70% of councils will have to increase council taxes next spring to address the growing cost of essential services, increased rates of homelessness, and a longstanding accommodation deficit.
Medway council 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 taking innovative approaches but some of these take time to achieve both improved services and financial savings,” stated Vince Maple.
He continued: “We face population challenges which will persist to increase the pressures we have. As a local government body, we had a 91% cut in our revenue support grant from 2010-24, which is very challenging.”
National Patterns and Forecasts
A survey of county councils this week also found council budgets being strained by the growing number of children and adults requiring Send support.
A network of councils said that council deficits will reach 4.4 billion pounds a year by 2029, as they grapple to manage rising needs.
Ministers have put off scheduled changes to the Send system until the coming year after a policy document outlining those changes was recently delayed.
Deprivation and Financial Shortfalls
Based on the most recent indices of deprivation (IMD) covering UK local authorities, many participating urban areas were included in the most disadvantaged in England.
- “Member cities like Hull, Bradford, Stoke-on-Trent, Sunderland and Wolverhampton place in the most deprived 30 across the country under the 2025 IMD measures,” noted the study.
“While only one key city is among the top 10 for deprived neighbourhoods nationally, cities are far more likely to be in the most deprived fifth of England. The figures underscores the extent of difficulties confronting municipal officials across key cities in the coming year,” the report concluded.
“Council officials have been clear about the necessity for a equitable and lasting funding system that reflects and responds to the actual extent of deprivation and need,” stated Michael Mordey.
“Without this, councils will persist to face impossible choices around which essential services to fund, and which to cut, to the detriment of their communities.”
One in five of local authorities have cut or compromised social care provision in the past 12 months, the survey found.
