According to a new poll of local authorities, English councils are preparing to offload community centers, athletic facilities, and retail spaces as they bet on a rapid disposal of assets to stabilize finances.
Increasing Financial Pressures Drive Asset Sales
A coalition of councils representing major urban areas in England reported that 60% of local authorities are intending to dispose of properties to cover the rising costs of social services for vulnerable individuals.
Councils have in the past come under fire for disposing of public land and land to shore up their finances, but they contend they must continue to generate essential revenue from asset sales or declare themselves bankrupt.
The group noted that a significant number of authorities seeking to raise money from a quick sale of assets marked “a distinct shift from 2024, when the majority (60%) of municipal officials said they would prioritise service redesigns and utilising financial reserves to weather growing fiscal pressures.”
Specific Examples of Planned Sales
One local authority in southeast England announced its property management strategy featured the sale of a shopping centre in a local town and a community venue in Rochester to generate 20 million pounds over the next half-decade.
- A local golf course and commercial properties held in two English counties, which all provide rental income for the authority, will also be disposed of under the strategy.
Council Tax Increases and Broader Financial Strains
The survey of councils in the coalition, which covers several urban centers, further found that over seven in ten of authorities will have to increase local levies next April to address the growing cost of core provisions, higher levels of housing insecurity, and a longstanding accommodation deficit.
The authority explained it will press ahead 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 taking creative strategies but certain measures take time to achieve both better provisions and cost efficiency,” said Vince Maple.
He added: “We face population challenges which will continue to increase the pressures we have. As a local government body, we had a drastic reduction in our central funding from over the past decade, which is extremely difficult.”
Countrywide Trends and Forecasts
A survey of county councils recently further found council budgets being strained by the growing number of children and older individuals needing Send support.
The County Councils Network said that council deficits will reach £4.4bn a year by the end of the decade, as they grapple to manage increased demand.
Ministers have put off planned reforms to the Send system until next year after a white paper setting out those reforms has been postponed.
Disadvantage and Funding Gaps
According to the most recent deprivation measures (the Index of Multiple Deprivation) for UK local authorities, several key cities members were included in the most disadvantaged in England.
- “Participating urban centers like Hull, Bradford, Stoke-on-Trent, Sunderland and Wolverhampton rank in the most deprived 30 across the country under the latest deprivation indices,” said the study.
“While only one key city is in the ten most deprived for disadvantaged communities countrywide, urban areas are much more prone to be in the most deprived fifth of England. The data highlights the extent of challenges confronting municipal officials across major urban centers in the next twelve months,” the analysis added.
“Council officials have been clear about the necessity for a equitable and lasting financial structure that accounts for and responds to the real levels of deprivation and need,” stated Michael Mordey.
“Lacking this, local authorities will continue to face impossible choices around which essential services to allocate spend to, and which to reduce, to the detriment of their communities.”
A fifth of local authorities have reduced or weakened care services in the past 12 months, the study found.
