Based on a recent survey of local authorities, UK councils are planning to sell social clubs, sports centres, and retail spaces as they bet on a fire sale of assets to stabilize finances.
Increasing Financial Pressures Prompt Asset Sales
A coalition of councils representing second-tier cities in the UK stated that 60% of councils are intending to dispose of properties to cover the escalating costs of adult and children’s social care.
Local governments have in the past come under fire for selling playing fields and land to support their budgets, but they argue they must proceed to generate essential revenue from property disposals or declare themselves bankrupt.
The group noted that a significant number of authorities seeking to raise money from a fire sale of holdings represented “a distinct shift from 2024, when the majority (six in ten) of local leaders stated they would focus on restructuring services and utilising savings to manage increasing fiscal pressures.”
Detailed Examples of Proposed Disposals
One local authority in Kent announced its asset disposal plan included the sale of a retail complex in a local town and a community venue in another town to generate £20m over five years.
- Gillingham golf club and commercial properties held in two English counties, which all provide rental income for the authority, will also be disposed of under the strategy.
Council Tax Increases and Broader Fiscal Pressures
The survey of local authorities in the coalition, which includes Sunderland, Southampton, Gloucester and Salford, also found that more than 70% of councils will need to raise council taxes next spring to cover the growing cost of essential services, higher levels of homelessness, and a persistent housing shortage.
Medway council said it will press ahead with property disposals after sharp increases in the cost of youth support, support for vulnerable learners, elderly and disability services, and temporary accommodation.
“We are adopting creative strategies but some of these take time to deliver both better provisions and financial savings,” stated Vince Maple.
He added: “We face population challenges which will persist to add to the strains we have. As a local government body, we had a drastic reduction in our central funding from over the past decade, which is extremely difficult.”
National Patterns and Forecasts
A survey of county councils this week also found council budgets being strained by the increasing figures of children and older individuals requiring special educational assistance.
A network of councils said that local shortfalls will hit £4.4bn a year by 2029, as they struggle to cope with increased demand.
Ministers have delayed planned reforms to the special educational needs framework until next year after a policy document outlining those reforms was recently delayed.
Disadvantage and Funding Shortfalls
Based on the latest indices of deprivation (IMD) for English councils, many participating urban areas were among the most deprived in the country.
- “Participating urban centers like several major towns rank in the top 30 nationally under the 2025 IMD measures,” noted the report.
“While only one key city is in the top 10 for deprived neighbourhoods countrywide, cities are far more likely to be in the worst-off 20% of the nation. The figures underscores the scale of challenges facing municipal officials across major urban centers in the next twelve months,” the analysis added.
“Council officials have been explicit about the necessity for a fair and sustainable financial structure that accounts for and addresses the actual extent of deprivation and demand,” stated Michael Mordey.
“Lacking this, councils will continue to face impossible choices around which vital provisions to fund, and which to reduce, to the disadvantage of their residents.”
One in five of councils have reduced or weakened social care provision in the past 12 months, the study found.
