Based on a recent poll of local authorities, English councils are preparing to sell social clubs, sports centres, and shopping arcades as they rely on a rapid disposal of assets to balance the books.
Growing Financial Pressures Drive Asset Sales
A coalition of councils representing second-tier cities in England stated that 60% of local authorities are intending to sell assets to cover the rising costs of adult and children’s social care.
Local governments have in the past come under fire for selling playing fields and land to support their budgets, but they contend they must proceed to raise vital cash from asset sales or declare themselves bankrupt.
The group noted that a high proportion of authorities seeking to raise money from a quick sale of assets marked “a distinct shift from 2024, when the majority (six in ten) of municipal officials stated they would focus on restructuring services and using savings to manage increasing financial challenges.”
Detailed Examples of Planned Disposals
Medway Council in Kent announced its asset disposal plan included the sale of a shopping centre in Rainham and a community venue in Rochester to raise 20 million pounds over the next half-decade.
- A local golf course and business parks owned in Worcestershire and Suffolk, which all generate rent for Medway council, will additionally be sold under the strategy.
Local Levy Rises and Wider Fiscal Pressures
This research of councils in the key cities group, which includes Sunderland, Southampton, Gloucester and Salford, further found that over seven in ten of authorities will have to increase council taxes next April to address the rising cost of core provisions, increased rates of housing insecurity, and a longstanding accommodation deficit.
The authority explained it will proceed with asset sales after steep rises in the cost of youth support, support for vulnerable learners, adult social care, and temporary accommodation.
“We are taking creative strategies but certain measures require time to achieve 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 central funding from 2010-24, which is very challenging.”
Countrywide Patterns and Forecasts
Research of regional authorities recently also found local finances being stretched by the growing number of children and older individuals requiring special educational assistance.
The County Councils Network said that local shortfalls will hit 4.4 billion pounds a year by 2029, as they grapple to manage rising needs.
Ministers have put off planned reforms to the special educational needs framework until next year after a white paper setting out those reforms has been postponed.
Deprivation and Financial Gaps
Based on the latest deprivation measures (IMD) covering UK local authorities, many key cities members were included in the most deprived in England.
- “Participating urban centers like several major towns rank in the top 30 across the country under the latest IMD measures,” said the report.
“While only a single urban area is in the top 10 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 municipal officials across major urban centers in the coming year,” the analysis added.
“Local government leaders have been explicit about the need for a equitable and lasting funding system that reflects and addresses the real levels of deprivation and demand,” stated Michael Mordey.
“Without this, local authorities will persist to face impossible choices around which vital provisions to fund, and which to cut, to the disadvantage of their communities.”
One in five of councils have cut or compromised social care provision in the past 12 months, the study found.
