Based on a new study of local authorities, English councils are planning to offload social clubs, sports centres, and retail spaces as they rely on a rapid disposal of assets to balance the books.
Increasing Fiscal Pressures Prompt Asset Sales
A coalition of councils representing major urban areas in England reported that six out of ten of councils are planning to sell assets to meet the rising costs of social services for vulnerable individuals.
Local governments have previously come under fire for disposing of playing fields and land to support their finances, but they argue they must proceed to generate essential revenue from property disposals or face insolvency.
The group noted that a high proportion of authorities seeking to raise money from a quick sale of assets marked “a clear change from 2024, when the largest share (60%) of local leaders stated they would focus on service redesigns and utilising savings to weather increasing financial challenges.”
Specific Cases of Proposed Disposals
One local authority in southeast England said its asset disposal plan featured the disposal of a shopping centre in a local town and a community venue in Rochester to generate 20 million pounds over five years.
- A local golf course and commercial properties owned in two English counties, which all provide rental income for Medway council, will also be sold under the plan.
Local Levy Increases and Broader Financial Pressures
This research of local authorities in the coalition, which includes Sunderland, Southampton, Gloucester and Salford, further found that more than 70% of councils will have to increase council taxes next April to cover the growing cost of core provisions, higher levels of homelessness, and a persistent housing shortage.
The authority explained it will press ahead with property disposals after steep rises in the cost of children services, support for vulnerable learners, adult social care, and temporary accommodation.
“We are adopting creative strategies but certain measures take time to achieve both better provisions and cost efficiency,” said a council leader.
He added: “We face demographic pressures which will continue to add to the pressures we have. As a local government body, we had a drastic reduction in our revenue support grant from over the past decade, which is very challenging.”
Countrywide Patterns and Forecasts
A survey of county councils recently further found local finances being strained by the increasing figures of young people and adults requiring Send support.
The County Councils Network projected that council deficits will hit £4.4bn a year by the end of the decade, as they grapple to manage increased demand.
Government officials have delayed scheduled changes to the special educational needs framework until the coming year after a policy document outlining those reforms was recently delayed.
Disadvantage and Funding Shortfalls
Based on the most recent deprivation measures (IMD) for UK local authorities, several participating urban areas were among the most disadvantaged in England.
- “Participating urban centers like Hull, Bradford, Stoke-on-Trent, Sunderland and Wolverhampton place in the top 30 across the country under the latest deprivation indices,” noted the study.
“While only a single urban area is in the top 10 for disadvantaged communities nationally, urban areas are much more prone to be in the most deprived fifth of the nation. The figures highlights the extent of difficulties confronting local leaders across key cities in the coming year,” the analysis concluded.
“Local government leaders have been clear about the necessity for a equitable and lasting financial structure that reflects and responds to the actual extent of disadvantage and demand,” said Michael Mordey.
“Lacking this, councils will continue to face difficult decisions around which essential services to fund, and which to reduce, to the disadvantage of their residents.”
One in five of councils have cut or compromised social care provision in the last year, the study found.
