Based on a latest survey of local authorities, English councils are preparing to offload community centers, sports centres, and retail spaces as they bet on a fire sale of properties to stabilize finances.
Growing Financial Challenges Prompt Asset Sales
The Key Cities Group representing major urban areas in the UK reported that 60% of councils are intending to sell assets to cover the escalating costs of adult and children’s social care.
Local governments have previously faced criticism for selling public land and land to support their budgets, but they contend they must continue to generate essential revenue from property disposals or face insolvency.
The group said that a significant number of councils seeking to raise money from a fire sale of holdings marked “a clear change from 2024, when the majority (six in ten) of local leaders said they would prioritise restructuring services and using savings to weather growing financial challenges.”
Specific Examples of Proposed Disposals
Medway Council in Kent announced its property management strategy included the disposal of a retail complex in a local town and a social club in another town to generate £20m over the next half-decade.
- A local golf course and commercial properties owned in Worcestershire and Suffolk, which all provide rental income for the authority, will additionally be sold under the plan.
Council Tax Rises and Wider Fiscal Pressures
The survey of councils in the coalition, which covers Sunderland, Southampton, Gloucester and Salford, also found that over seven in ten of authorities will have to increase council taxes next April to address the growing cost of core provisions, higher levels of housing insecurity, and a persistent accommodation deficit.
Medway council explained it will proceed with asset sales after steep rises in the cost of youth support, special educational needs and disability (Send) provision, elderly and disability services, and short-term housing.
“We are taking creative strategies but some of these require time to achieve both better provisions and cost efficiency,” said a council leader.
He continued: “There are population challenges which will persist to add to the pressures we have. As a unitary authority, we had a 91% cut in our central funding from over the past decade, which is very challenging.”
Countrywide Trends and Forecasts
Research of regional authorities this week further found local finances being strained by the increasing figures of young people and older individuals requiring Send support.
The County Councils Network said that council deficits will hit £4.4bn a year by 2029, as they struggle to manage rising needs.
Ministers have delayed planned reforms to the special educational needs framework until the coming year after a policy document outlining those changes was recently delayed.
Disadvantage and Funding Gaps
According to the most recent deprivation measures (IMD) covering UK local authorities, several key cities members were included in the most deprived in the country.
- “Member cities like several major towns rank in the top 30 nationally under the 2025 IMD measures,” noted the report.
“While only one key city is among the top 10 for disadvantaged communities countrywide, urban areas are much more prone to be in the worst-off 20% of the nation. The data underscores the scale of challenges facing municipal officials across major urban centers in the next twelve months,” the analysis concluded.
“Local government leaders have been clear about the necessity for a fair and sustainable funding system that reflects and addresses the real levels of deprivation and demand,” said a council leader.
“Without this, local authorities will persist to face impossible choices around which vital provisions to allocate spend to, and which to reduce, to the detriment of their residents.”
A fifth of local authorities have reduced or weakened social care provision in the past 12 months, the study revealed.
