Based on a latest study of municipal councils, English councils are planning to offload community centers, athletic facilities, and shopping arcades as they bet on a fire sale of assets to stabilize finances.
Increasing Fiscal Pressures Prompt Asset Sales
A coalition of councils for second-tier cities in the UK stated that six out of ten of councils are planning to dispose of properties to meet the escalating costs of adult and children’s social care.
Councils have in the past come under fire for disposing of public land and open spaces to support their finances, but they contend they must proceed to generate essential revenue from property disposals or declare themselves bankrupt.
The group noted that a high proportion of councils attempting to raise money from a quick sale of assets marked “a clear change from 2024, when the majority (six in ten) of local leaders said they would prioritise service redesigns and utilising savings to manage growing fiscal pressures.”
Detailed Examples of Planned Disposals
Medway Council in Kent said its asset disposal plan featured the disposal of a retail complex in a local town and a social club in Rochester to raise £20m over the next half-decade.
- A local golf course and commercial properties owned in two English counties, which all provide rental income for Medway council, will also be sold under the strategy.
Council Tax Rises and Wider Financial Strains
The survey of local authorities in the coalition, which covers several urban centers, further found that over seven in ten of councils will have to raise council taxes next April to address the rising cost of essential services, higher levels of housing insecurity, and a longstanding accommodation deficit.
Medway council explained it will proceed with property disposals after steep rises in the cost of children services, support for vulnerable learners, adult social care, and short-term housing.
“We are adopting innovative approaches but certain measures take time to achieve both improved services and financial savings,” said Vince Maple.
He added: “There are population challenges which will continue to increase the pressures we have. As a local government body, we had a 91% cut in our central funding from over the past decade, which is very challenging.”
Countrywide Patterns and Forecasts
A survey of county councils recently also found local finances being stretched by the increasing figures of young people and adults requiring Send support.
The County Councils Network said that local shortfalls will reach £4.4bn a year by the end of the decade, as they grapple to cope with rising needs.
Government officials have put off planned reforms to the special educational needs framework until the coming year after a white paper outlining those reforms was recently delayed.
Deprivation and Funding Gaps
Based on the latest deprivation measures (the Index of Multiple Deprivation) for English councils, several key cities members were included in the most disadvantaged in the country.
- “Participating urban centers like Hull, Bradford, Stoke-on-Trent, Sunderland and Wolverhampton rank in the most deprived 30 across the country under the latest deprivation indices,” said the study.
“Although only one key city is in the top 10 for deprived neighbourhoods countrywide, urban areas are far more likely to be in the most deprived fifth of the nation. The data underscores the extent of challenges confronting local leaders across major urban centers in the next twelve months,” the report added.
“Local government leaders have been explicit about the need for a fair and sustainable financial structure that accounts for and addresses the real levels of deprivation and demand,” said Michael Mordey.
“Lacking this, local authorities will persist to face difficult decisions around which essential services to allocate spend to, and which to cut, to the disadvantage of their communities.”
A fifth of local authorities have cut or compromised care services in the past 12 months, the study found.
