Based on a new study of local authorities, English councils are planning to sell social clubs, sports centres, and shopping arcades as they bet on a rapid disposal of properties to stabilize finances.
Growing Financial Challenges Drive Asset Sales
A coalition of councils for second-tier cities in England stated that 60% of local authorities are planning to dispose of properties to cover the escalating costs of adult and children’s social care.
Local governments have previously come under fire for selling public land and land to support their budgets, but they contend they must continue to generate essential revenue from asset sales or declare themselves bankrupt.
The group noted that a significant number of authorities seeking to generate funds from a quick sale of holdings represented “a clear change from 2024, when the majority (six in ten) of local leaders stated they would prioritise restructuring services and using savings to weather growing fiscal pressures.”
Detailed Cases of Proposed Sales
Medway Council in Kent said its property management strategy featured the sale of a shopping centre in Rainham and a social club in Rochester to generate £20m over five years.
- Gillingham golf club and commercial properties owned in two English counties, which all generate rent for the authority, will additionally be sold under the strategy.
Local Levy Increases and Broader Financial Pressures
The survey of local authorities in the key cities group, which includes several urban centers, further found that more than 70% of authorities will need to raise local levies next spring to address the rising cost of essential services, increased rates of housing insecurity, and a longstanding accommodation deficit.
Medway council said it will proceed with asset sales after sharp increases in the cost of children services, special educational needs and disability (Send) provision, elderly and disability services, and temporary accommodation.
“We are adopting innovative approaches but certain measures take time to deliver both better provisions and financial savings,” said a council leader.
He continued: “There are population challenges which will persist to increase the strains we have. As a unitary authority, we had a drastic reduction in our central funding from over the past decade, which is very challenging.”
Countrywide Patterns and Projections
A survey of county councils this week further found council budgets being stretched by the growing number of children and older individuals needing special educational assistance.
The County Councils Network said that local shortfalls will hit £4.4bn a year by the end of the decade, as they grapple to manage increased demand.
Ministers have delayed scheduled changes to the Send system until the coming year after a white paper setting out those reforms was recently delayed.
Deprivation and Funding Gaps
According to the latest indices of deprivation (the Index of Multiple Deprivation) covering English councils, many participating urban areas were included in the most disadvantaged in England.
- “Member cities like several major towns place in the most deprived 30 across the country under the latest IMD measures,” said the report.
“While only a single urban area is in the ten most deprived for deprived neighbourhoods nationally, cities are far more likely to be in the most deprived fifth of the nation. The data highlights the scale of difficulties confronting local leaders across major urban centers in the coming year,” the analysis added.
“Council officials have been explicit about the need for a fair and sustainable funding system that accounts for and addresses the real levels of disadvantage and demand,” stated a council leader.
“Lacking this, local authorities will continue to face impossible choices around which vital provisions to fund, and which to reduce, to the detriment of their communities.”
A fifth of councils have cut or compromised social care provision in the past 12 months, the survey revealed.
