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Based on a new poll of local authorities, English councils are preparing to sell social clubs, sports centres, and retail spaces as they rely on a rapid disposal of properties to stabilize finances.

Increasing Fiscal Pressures Prompt Asset Sales

A coalition of councils for second-tier cities in England reported that 60% of councils are planning to dispose of properties to cover the rising costs of adult and children’s social care.

Councils have in the past faced criticism for selling public land and open spaces to support their budgets, but they argue they must continue to generate essential revenue from property disposals or face insolvency.

The group said that a significant number of councils seeking to generate funds from a fire sale of assets marked “a clear change from 2024, when the majority (six in ten) of municipal officials stated they would prioritise restructuring services and utilising financial reserves to weather growing financial challenges.”

Specific Examples of Planned 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 community venue in Rochester to raise 20 million pounds over the next half-decade.

• Gillingham golf club and commercial properties held in Worcestershire and Suffolk, which all generate rent for the authority, will also be sold under the plan.

Council Tax Increases and Wider Fiscal Pressures

The survey of councils in the key cities group, which covers Sunderland, Southampton, Gloucester and Salford, further found that more than 70% of authorities will have to raise local levies next April to cover the rising cost of core provisions, higher levels of homelessness, and a persistent housing shortage.

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 short-term housing.

“We are adopting innovative approaches but certain measures take time to deliver both improved services and cost efficiency,” said Vince Maple.

He added: “There are demographic pressures which will continue to add to the pressures we have. As a local government body, we had a 91% cut in our revenue support grant from over the past decade, which is extremely difficult.”

Countrywide Trends and Forecasts

Research of regional authorities this week also found council budgets being stretched by the increasing figures of young people and older individuals needing Send support.

The County Councils Network projected that local shortfalls will reach £4.4bn a year by the end of the decade, as they grapple to cope with rising needs.

Ministers have delayed planned reforms to the Send system until next year after a policy document setting out those reforms was recently delayed.

Disadvantage and Funding Gaps

Based on the most recent deprivation measures (the Index of Multiple Deprivation) covering UK local authorities, many participating urban areas were included in the most disadvantaged in England.

• “Member cities like Hull, Bradford, Stoke-on-Trent, Sunderland and Wolverhampton place in the top 30 nationally under the latest deprivation indices,” noted the study.

“While only a single urban area is among the ten most deprived for disadvantaged communities countrywide, urban areas are far more likely to be in the worst-off 20% of England. The data highlights the scale of difficulties facing local leaders across key cities in the coming year,” the report added.

“Council officials have been clear about the necessity for a fair and sustainable funding system that accounts for and addresses the real levels of disadvantage and need,” said Michael Mordey.

“Lacking this, local authorities will continue to face impossible choices around which essential services to fund, and which to reduce, to the disadvantage of their communities.”

One in five of councils have cut or compromised care services in the last year, the study found.