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Based on a recent poll of local authorities, UK councils are planning to offload community centers, athletic facilities, and retail spaces as they bet on a rapid disposal of properties to balance the books.

Growing Fiscal Challenges Prompt Asset Sales

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

Local governments have in the past faced criticism for disposing of playing fields and open spaces to shore up their budgets, but they argue they must continue to generate essential revenue from asset sales or face insolvency.

This coalition noted that a high proportion of councils attempting to generate funds from a quick sale of holdings marked “a distinct shift from 2024, when the majority (60%) of local leaders said they would prioritise service redesigns and utilising financial reserves to manage growing fiscal pressures.”

Specific Examples of Planned Sales

Medway Council in Kent announced its asset disposal plan featured the disposal of a retail complex in Rainham and a social club in Rochester to raise £20m over the next half-decade.

• Gillingham golf club and commercial properties held in two English counties, which all provide rental income for Medway council, will also be sold under the plan.

Local Levy Increases and Broader Fiscal Pressures

This research of councils in the coalition, which includes Sunderland, Southampton, Gloucester and Salford, further found that over seven in ten of authorities will need to raise local levies next spring to cover the rising cost of core provisions, higher levels of homelessness, and a longstanding housing shortage.

The authority explained it will press ahead with asset sales after sharp increases in the cost of youth support, special educational needs and disability (Send) provision, adult social care, and temporary accommodation.

“We are taking creative strategies but some of these require time to deliver both better provisions and financial savings,” said a council leader.

He added: “There are population challenges which will continue to increase the strains we have. As a unitary authority, we had a drastic reduction in our central funding from over the past decade, which is very challenging.”

Countrywide Patterns and Projections

Research of county councils this week further found council budgets being stretched by the increasing figures of children and adults requiring special educational assistance.

The County Councils Network said that local shortfalls will hit £4.4bn a year by 2029, as they grapple to cope with rising needs.

Government officials have delayed scheduled changes to the special educational needs framework until next year after a white paper setting out those changes has been postponed.

Deprivation and Financial Gaps

Based on the latest deprivation measures (the Index of Multiple Deprivation) for English councils, many participating urban areas were included in the most disadvantaged in the country.

• “Participating urban centers like several major towns rank in the most deprived 30 across the country under the latest deprivation indices,” noted the study.

“While only one key city is in the ten most deprived for deprived neighbourhoods nationally, cities are much more prone to be in the worst-off 20% of the nation. The figures highlights the scale of difficulties facing local leaders across major urban centers in the coming year,” the analysis concluded.

“Local government leaders have been clear about the need for a equitable and lasting financial structure that accounts for and addresses the real levels of deprivation and demand,” said a council leader.

“Lacking this, local authorities will persist to face difficult decisions around which vital provisions to fund, and which to reduce, to the detriment of their residents.”

One in five of councils have reduced or weakened social care provision in the past 12 months, the study revealed.