Based on a recent poll of local authorities, English councils are preparing to sell community centers, sports centres, and retail spaces as they rely on a fire sale of properties to balance the books.
Growing Fiscal Pressures Prompt Asset Sales
A coalition of councils representing second-tier cities in England stated that six out of ten of councils are planning to sell assets to cover the rising costs of adult and children’s social care.
Councils have previously faced criticism for disposing of public land and land to shore up their budgets, but they contend they must proceed to raise vital cash from asset sales or declare themselves bankrupt.
The group noted that a significant number of authorities attempting to raise money from a quick sale of assets marked “a clear change from 2024, when the largest share (60%) of local leaders said they would prioritise service redesigns and utilising financial reserves to weather growing financial challenges.”
Specific Examples of Planned Disposals
Medway Council in Kent said its property management strategy featured the sale of a retail complex in Rainham and a community venue in another town to raise 20 million pounds over the next half-decade.
- A local golf course and commercial properties held in Worcestershire and Suffolk, which all provide rental income for the authority, will also be disposed of under the strategy.
Local Levy Increases and Wider Financial Strains
This research of local authorities in the coalition, which includes several urban centers, also found that over seven in ten of councils will have to increase local levies next April to address the rising cost of core provisions, higher levels of housing insecurity, and a longstanding housing shortage.
The authority explained 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 short-term housing.
“We are adopting creative strategies but some of these take time to deliver both improved services and cost efficiency,” said Vince Maple.
He continued: “There are demographic pressures which will continue to increase the pressures we have. As a unitary authority, we had a drastic reduction in our revenue support grant from over the past decade, which is very challenging.”
Countrywide Trends and Projections
A survey of county councils this week further found council budgets being strained by the growing number of children and older individuals requiring special educational assistance.
A network of councils said that local shortfalls will hit 4.4 billion pounds a year by the end of the decade, as they grapple to cope with increased demand.
Government officials have delayed scheduled changes to the special educational needs framework until the coming year after a white paper setting out those changes has been postponed.
Deprivation and Financial Gaps
Based on the latest indices of deprivation (the Index of Multiple Deprivation) covering UK local authorities, many key cities members were included in the most deprived in England.
- “Member cities like Hull, Bradford, Stoke-on-Trent, Sunderland and Wolverhampton rank in the top 30 nationally under the latest deprivation indices,” said the study.
“While only one key city is among the ten most deprived for deprived neighbourhoods nationally, urban areas are far more likely to be in the worst-off 20% of England. The figures highlights the extent of challenges confronting local leaders across key cities in the coming year,” the analysis added.
“Local government leaders have been clear about the need for a fair and sustainable financial structure that accounts for and addresses the actual extent of disadvantage and demand,” said Michael Mordey.
“Lacking this, local authorities will continue to face difficult decisions 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 care services in the past 12 months, the survey revealed.
