According to a new poll of local authorities, English councils are planning to offload community centers, athletic facilities, and retail spaces as they rely on a fire sale of properties to balance the books.
Increasing Fiscal Challenges Prompt Asset Sales
A coalition of councils for second-tier cities in the UK reported that six out of ten of local authorities are planning to sell assets to cover the rising costs of social services for vulnerable individuals.
Councils have previously come under fire for disposing of playing fields and open spaces to support their finances, but they contend they must continue to raise vital cash from asset sales or declare themselves bankrupt.
This coalition noted that a significant number of councils seeking to generate funds from a fire sale of holdings represented “a clear change from 2024, when the largest share (six in ten) of local leaders stated they would prioritise service redesigns and using savings to manage increasing fiscal pressures.”
Specific Cases of Proposed Disposals
One local authority in southeast England said its property management strategy featured the disposal of a retail complex in a local town and a social club in Rochester to raise £20m over five years.
- Gillingham golf club and business parks owned in Worcestershire and Suffolk, which all generate rent for Medway council, will also be disposed of under the strategy.
Local Levy Rises and Wider Fiscal Strains
The survey of councils in the key cities group, which includes several urban centers, also found that more than 70% of authorities will have to increase local levies next April to cover the growing cost of core provisions, increased rates of homelessness, and a longstanding accommodation deficit.
Medway council explained it will proceed with property disposals after sharp increases in the cost of youth support, support for vulnerable learners, adult social care, and temporary accommodation.
“We are taking creative strategies but some of these require time to deliver both better provisions and cost efficiency,” said Vince Maple.
He continued: “We face demographic pressures which will continue to increase the pressures we have. As a local government body, we had a drastic reduction in our revenue support grant from 2010-24, which is very challenging.”
National Patterns and Projections
Research of regional authorities this week further found council budgets being strained by the growing number of children and older individuals needing Send support.
The County Councils Network said that council deficits will reach 4.4 billion pounds a year by 2029, as they struggle to manage rising needs.
Ministers have put off scheduled changes to the special educational needs framework until the coming year after a white paper outlining those changes has been postponed.
Disadvantage and Funding Gaps
According to the most recent indices of deprivation (the Index of Multiple Deprivation) covering English councils, many key cities members were among the most disadvantaged in the country.
- “Member cities like several major towns rank in the most deprived 30 nationally under the latest deprivation indices,” said the study.
“While only one key city is in the ten most deprived for disadvantaged communities nationally, cities are much more prone to be in the most deprived fifth of England. The data highlights the scale of challenges 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 financial structure that reflects and addresses the real levels of deprivation and need,” stated Michael Mordey.
“Without this, councils will continue to face difficult decisions around which essential services to allocate spend to, and which to reduce, to the disadvantage of their residents.”
A fifth of local authorities have cut or compromised care services in the last year, the survey revealed.
