🔗 Share this article

Based on a recent poll of local authorities, UK councils are preparing to offload social clubs, athletic facilities, and retail spaces as they bet on a rapid disposal of assets to stabilize finances.

Increasing Fiscal Pressures Drive Asset Sales

The Key Cities Group representing second-tier cities in the UK reported that six out of ten of local authorities are planning to dispose of properties to cover the escalating costs of adult and children’s social care.

Local governments have previously come under fire for disposing of public land and land to shore up their budgets, but they argue they must continue to raise vital cash from property disposals or declare themselves bankrupt.

The group noted that a significant number of authorities seeking to generate funds from a fire sale of holdings represented “a distinct shift from 2024, when the majority (six in ten) of local leaders said they would prioritise service redesigns and using financial reserves to manage growing financial challenges.”

Detailed Cases of Planned Sales

Medway Council in Kent said its property management strategy included the disposal of a shopping centre in a local town and a social club in Rochester to raise 20 million pounds over five years.

• Gillingham golf club and business parks owned in two English counties, which all provide rental income for the authority, will also be disposed of under the plan.

Local Levy Rises and Broader Financial Strains

The survey of local authorities in the key cities group, which covers several urban centers, further found that over seven in ten of councils will need to raise local levies next April to cover the growing cost of core provisions, higher levels of housing insecurity, and a persistent accommodation deficit.

The authority said it will press ahead with property disposals after sharp increases in the cost of children services, support for vulnerable learners, adult social care, and short-term housing.

“We are taking creative strategies but some of these take time to achieve both better provisions and cost efficiency,” said a council leader.

He added: “There are population challenges which will continue to increase the pressures we have. As a local government body, we had a 91% cut in our revenue support grant from 2010-24, which is extremely difficult.”

Countrywide Trends and Projections

A survey of county councils this week also found council budgets being stretched by the growing number of children and older individuals requiring Send support.

The County Councils Network said that local shortfalls will hit 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 the coming year after a white paper setting out those changes was recently delayed.

Disadvantage and Financial Shortfalls

Based on the latest indices of deprivation (IMD) covering English councils, many key cities members were included in the most disadvantaged in the country.

• “Participating urban centers like Hull, Bradford, Stoke-on-Trent, Sunderland and Wolverhampton place in the top 30 nationally under the latest deprivation indices,” noted the report.

“While only a single urban area is in the top 10 for disadvantaged communities nationally, cities are much more prone to be in the most deprived fifth of the nation. The data highlights the scale of difficulties confronting local leaders across major urban centers in the coming year,” the analysis added.

“Local government leaders have been clear about the need for a equitable and lasting funding system that accounts for and addresses the actual extent of deprivation and need,” stated a council leader.

“Lacking this, councils will continue to face difficult decisions around which vital provisions to fund, and which to cut, to the detriment of their communities.”

One in five of local authorities have reduced or weakened care services in the past 12 months, the study found.