Based on a new study of municipal councils, English councils are preparing to offload social clubs, sports centres, and shopping arcades as they rely on a fire sale of assets to balance the books.
Growing Financial Pressures Prompt Asset Sales
The Key Cities Group for major urban areas in England stated that 60% of councils are planning to sell assets to meet the escalating costs of adult and children’s social care.
Councils have in the past come under fire for selling public land and land to shore up their budgets, but they argue they must continue to raise vital cash from property disposals or face insolvency.
This coalition said that a significant number of authorities seeking to raise money from a fire sale of holdings represented “a clear change from 2024, when the largest share (60%) of local leaders said they would prioritise restructuring services and using savings to weather growing financial challenges.”
Detailed Examples of Planned Disposals
One local authority in southeast England announced its property management strategy featured the sale of a retail complex in Rainham and a community venue in another town to generate £20m over five years.
- Gillingham golf club and commercial properties held in Worcestershire and Suffolk, which all provide rental income for Medway council, will also be disposed of under the plan.
Council Tax Increases and Broader Fiscal Pressures
The survey of local authorities in the key cities group, which covers Sunderland, Southampton, Gloucester and Salford, also found that over seven in ten of councils will need to increase local levies next spring to address the rising cost of core provisions, higher levels of housing insecurity, and a persistent housing shortage.
The authority said it will proceed with asset sales after sharp increases in the cost of children services, special educational needs and disability (Send) provision, adult social care, and temporary accommodation.
“We are taking innovative approaches but some of these require time to deliver both improved services and cost efficiency,” said a council leader.
He added: “We face demographic pressures which will continue to increase the strains we have. As a local government body, we had a 91% cut in our revenue support grant from 2010-24, which is very challenging.”
Countrywide Patterns and Forecasts
A survey of county councils recently further found council budgets being stretched by the increasing figures of children and older individuals requiring special educational assistance.
The County Councils Network said that local shortfalls will reach £4.4bn a year by 2029, as they struggle to manage rising needs.
Ministers have put off planned reforms to the Send system until next year after a policy document setting out those reforms has been postponed.
Disadvantage and Financial Shortfalls
Based on the most recent indices of deprivation (IMD) for UK local authorities, several participating urban areas were among the most deprived in the country.
- “Participating urban centers like several major towns rank in the most deprived 30 nationally under the 2025 IMD measures,” said the report.
“While only one key city is in the top 10 for disadvantaged communities nationally, cities are far more likely to be in the worst-off 20% of England. The data highlights the scale of difficulties confronting local leaders across key cities in the coming year,” the report added.
“Local government leaders have been explicit about the necessity for a equitable and lasting funding system that accounts for and responds to the actual extent of deprivation and need,” stated Michael Mordey.
“Lacking this, councils will persist to face impossible choices around which essential services to allocate spend to, and which to cut, to the detriment of their communities.”
A fifth of councils have cut or compromised social care provision in the past 12 months, the study revealed.
