According to a new study of local authorities, UK councils are preparing to sell social clubs, athletic facilities, and shopping arcades as they rely on a fire sale of properties to balance the books.
Increasing Financial Pressures Prompt Asset Sales
The Key Cities Group for second-tier cities in England stated that six out of ten of councils are intending to dispose of properties to cover the escalating costs of social services for vulnerable individuals.
Local governments have in the past faced criticism for disposing of playing fields and land to shore up their budgets, but they argue they must proceed to generate essential revenue from asset sales or face insolvency.
This coalition noted that a high proportion of councils seeking to generate funds from a quick sale of holdings represented “a clear change from 2024, when the largest share (six in ten) of municipal officials stated they would focus on restructuring services and using savings to manage growing financial challenges.”
Specific Cases of Proposed Sales
One local authority in Kent said its asset disposal plan featured the sale of a retail complex in a local town and a social club in Rochester to generate £20m over five years.
- 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.
Local Levy Increases and Wider Fiscal Pressures
The survey of local authorities in the coalition, which covers Sunderland, Southampton, Gloucester and Salford, further found that more than 70% of authorities will need to increase council taxes next April to address 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 youth support, support for vulnerable learners, adult social care, and short-term housing.
“We are taking innovative approaches but some of these require time to deliver both better provisions and financial savings,” said a council leader.
He added: “There are demographic pressures which will persist to add to the pressures we have. As a local government body, we had a 91% cut in our revenue support grant from 2010-24, which is very challenging.”
National Trends and Projections
A survey of county councils this week further found local finances being strained by the increasing figures of children and adults needing special educational assistance.
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 cope with rising needs.
Ministers have delayed scheduled changes to the Send system until next year after a policy document setting out those reforms has been postponed.
Disadvantage and Funding Gaps
According to the latest deprivation measures (IMD) covering English councils, many key cities members were among the most disadvantaged in the country.
- “Member cities like Hull, Bradford, Stoke-on-Trent, Sunderland and Wolverhampton place in the most deprived 30 nationally under the 2025 IMD measures,” 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 most deprived fifth of the nation. The data highlights the extent of challenges facing local leaders across key cities in the coming year,” the analysis concluded.
“Local government leaders have been explicit about the need for a fair and sustainable financial structure 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 vital provisions to allocate spend to, and which to cut, to the detriment of their communities.”
One in five of local authorities have reduced or weakened care services in the last year, the study revealed.
