Based on a recent study of local authorities, UK councils are preparing to offload social clubs, sports centres, and retail spaces as they rely on a fire sale of properties to balance the books.
Growing Financial Pressures Drive Asset Sales
The Key Cities Group representing major urban areas in the UK reported that six out of ten of councils are planning to dispose of properties to meet the escalating costs of adult and children’s social care.
Local governments have previously come under fire for selling playing fields and open spaces to shore up their finances, but they argue they must continue to raise vital cash from asset sales or declare themselves bankrupt.
This coalition noted that a significant number of councils seeking to raise money from a quick sale of holdings represented “a clear change from 2024, when the majority (60%) of local leaders said they would focus on restructuring services and using financial reserves to weather growing financial challenges.”
Specific Examples of Planned Disposals
Medway Council in Kent said its property management strategy included the disposal of a shopping centre in Rainham and a community venue in Rochester to raise £20m over five years.
- A local golf course and business parks owned in two English counties, which all generate rent for Medway council, will additionally be sold under the strategy.
Local Levy Rises and Wider Fiscal Pressures
The survey of councils in the coalition, which covers Sunderland, Southampton, Gloucester and Salford, further found that over seven in ten of authorities will have to raise council taxes next spring to cover the growing cost of essential services, increased rates of housing insecurity, and a persistent accommodation deficit.
Medway council explained it will press ahead with asset sales after sharp increases in the cost of children services, support for vulnerable learners, elderly and disability services, and temporary accommodation.
“We are taking creative strategies but certain measures take time to achieve both better provisions and financial savings,” stated Vince Maple.
He added: “We face demographic pressures which will continue to increase the strains we have. As a local government body, we had a drastic reduction in our revenue support grant from 2010-24, which is very challenging.”
National Trends and Forecasts
A survey of regional authorities this week also found local finances being stretched by the growing number of children and older individuals needing special educational assistance.
The County Councils Network projected that council deficits will reach £4.4bn a year by the end of the decade, as they grapple to cope with increased demand.
Government officials have put off scheduled changes to the special educational needs framework until the coming year after a policy document setting out those reforms was recently delayed.
Disadvantage and Funding Shortfalls
According to the latest indices of deprivation (IMD) for 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 place in the most deprived 30 nationally under the 2025 IMD measures,” said the study.
“While only one key city is in the top 10 for deprived neighbourhoods nationally, urban areas are far more likely to be in the most deprived fifth of England. The data underscores the extent of challenges confronting local leaders across major urban centers in the next twelve months,” the report added.
“Council officials have been clear about the necessity for a equitable and lasting financial structure that reflects and responds to the real levels of disadvantage and need,” stated Michael Mordey.
“Lacking this, local authorities will persist to face impossible choices around which essential services to fund, and which to cut, to the disadvantage of their residents.”
A fifth of councils have cut or compromised social care provision in the past 12 months, the study revealed.
