Based on a latest poll of municipal councils, English councils are preparing to offload community centers, sports centres, and shopping arcades as they bet on a fire sale of properties to stabilize finances.
Increasing Financial 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 rising costs of social services for vulnerable individuals.
Councils have in the past faced criticism for disposing of playing fields and open spaces to support their finances, but they contend they must continue to generate essential revenue from asset sales or declare themselves bankrupt.
The group noted that a high proportion of authorities attempting to raise money from a fire sale of assets marked “a clear change from 2024, when the largest share (six in ten) of municipal officials stated they would prioritise service redesigns and using savings to weather growing financial challenges.”
Detailed Cases of Proposed Disposals
One local authority in Kent announced its asset disposal plan included the sale of a shopping centre in a local town and a community venue in Rochester to generate 20 million pounds over five years.
- A local golf course and commercial properties held in two English counties, which all generate rent for Medway council, will also be sold under the plan.
Local Levy Increases and Wider Fiscal Pressures
This research of councils in the coalition, which covers several urban centers, further found that more than 70% of councils will have to increase council taxes next April to address the rising cost of core provisions, higher levels of housing insecurity, and a persistent accommodation deficit.
The authority said it will proceed with property disposals after steep rises in the cost of youth support, special educational needs and disability (Send) provision, adult social care, and temporary accommodation.
“We are adopting creative strategies but certain measures take time to deliver both improved services and cost efficiency,” said Vince Maple.
He added: “We face population challenges which will continue to increase the pressures we have. As a unitary authority, we had a 91% cut in our central funding from 2010-24, which is very challenging.”
National Trends and Forecasts
Research of regional authorities this week also found local finances being strained by the increasing figures of children and adults requiring Send support.
The County Councils Network projected that local shortfalls will reach 4.4 billion pounds a year by the end of the decade, as they grapple to manage increased demand.
Ministers have put off planned reforms to the special educational needs framework until next year after a white paper outlining those reforms was recently delayed.
Deprivation and Financial Gaps
According to the latest indices of deprivation (the Index of Multiple Deprivation) for English councils, many participating urban areas were among the most disadvantaged in England.
- “Participating urban centers like Hull, Bradford, Stoke-on-Trent, Sunderland and Wolverhampton place in the top 30 nationally under the latest deprivation indices,” said the study.
“While only a single urban area is among the ten most deprived for disadvantaged communities nationally, urban areas are far more likely to be in the most deprived fifth of England. The figures highlights the scale of challenges confronting local leaders across key cities in the next twelve months,” the report concluded.
“Council officials have been explicit about the need for a fair and sustainable funding system that accounts for and addresses the actual extent of disadvantage and need,” said a council leader.
“Lacking this, local authorities will continue to face difficult decisions around which essential services to allocate spend to, and which to reduce, to the disadvantage of their communities.”
A fifth of councils have reduced or weakened care services in the last year, the survey revealed.
