Based on a recent poll of local authorities, English councils are planning to offload social clubs, athletic facilities, and shopping arcades as they bet on a fire sale of assets to stabilize finances.
Growing Fiscal Pressures Drive Asset Sales
A coalition of councils representing second-tier cities in England reported that 60% of councils are intending to sell assets to meet the escalating costs of adult and children’s social care.
Local governments have in the past faced criticism for selling playing fields and land to shore up their finances, but they argue they must proceed to raise vital cash from asset sales or declare themselves bankrupt.
The group noted that a high proportion of authorities attempting to raise money from a quick sale of holdings marked “a clear change from 2024, when the largest share (60%) of local leaders said they would focus on service redesigns and using savings to manage increasing financial challenges.”
Specific Examples of Proposed Sales
Medway Council in Kent said its property management strategy featured the disposal of a retail complex in a local town and a social club in another town to raise £20m over five years.
- A local golf course and business parks held in Worcestershire and Suffolk, which all provide rental income for Medway council, will additionally be sold under the strategy.
Council Tax Rises and Wider Fiscal Strains
The survey of local authorities in the key cities group, which includes several urban centers, further found that more than 70% of councils will need to increase council taxes next spring to cover the growing cost of core provisions, higher levels of housing insecurity, and a persistent accommodation deficit.
Medway council said it will press ahead with asset sales after steep rises in the cost of children services, special educational needs and disability (Send) provision, elderly and disability services, and temporary accommodation.
“We are taking creative strategies but certain measures require time to deliver both better provisions and cost efficiency,” stated Vince Maple.
He continued: “There are demographic pressures which will persist to add to the strains we have. As a unitary authority, we had a drastic reduction in our revenue support grant from over the past decade, which is extremely difficult.”
Countrywide Trends and Forecasts
A survey of county councils this week also found local finances being strained by the growing number of children and adults requiring special educational assistance.
The County Councils Network said that local shortfalls will reach £4.4bn a year by 2029, as they grapple to manage rising needs.
Ministers have delayed planned reforms to the special educational needs framework until the coming year after a policy document setting out those changes has been postponed.
Disadvantage and Financial Gaps
According to the latest deprivation measures (the Index of Multiple Deprivation) for English councils, many key cities members were included in the most disadvantaged in England.
- “Participating urban centers like Hull, Bradford, Stoke-on-Trent, Sunderland and Wolverhampton place in the most deprived 30 nationally under the latest IMD measures,” said the report.
“Although only one key city is in the ten most deprived for deprived neighbourhoods nationally, cities are far more likely to be in the most deprived fifth of England. The figures underscores the scale of difficulties facing municipal officials across major urban centers in the coming year,” the analysis concluded.
“Council officials have been clear about the need for a equitable and lasting financial structure that accounts for and addresses the real levels of disadvantage and demand,” said Michael Mordey.
“Without this, local authorities will continue to face difficult decisions around which essential services to allocate spend to, and which to cut, to the detriment of their residents.”
One in five of councils have cut or compromised care services in the last year, the study revealed.
