Based on a new study of local authorities, UK councils are planning to offload community centers, sports centres, and retail spaces as they rely on a fire sale of assets to balance the books.
Increasing Financial Challenges Prompt Asset Sales
The Key Cities Group representing second-tier cities in England reported that 60% of councils are intending to dispose of properties to cover the escalating costs of social services for vulnerable individuals.
Councils have in the past faced criticism for selling playing fields and land to support their budgets, but they contend they must continue to generate essential revenue from property disposals or declare themselves bankrupt.
The group said that a high proportion of authorities attempting to generate funds from a quick sale of holdings marked “a distinct shift from 2024, when the majority (six in ten) of municipal officials said they would focus on restructuring services and utilising financial reserves to weather growing financial challenges.”
Specific Cases of Planned Disposals
One local authority in Kent said its asset disposal plan included the disposal of a shopping centre in Rainham and a social club in Rochester to generate £20m over the next half-decade.
- Gillingham golf club and business parks held in Worcestershire and Suffolk, which all provide rental income for Medway council, will additionally be disposed of under the plan.
Local Levy Rises and Broader Financial Pressures
The survey of local authorities in the coalition, which includes several urban centers, also found that more than 70% of councils will have to raise local levies next spring to cover the growing cost of core provisions, increased rates of homelessness, and a persistent housing shortage.
The authority said it will proceed with asset sales after steep rises in the cost of children services, special educational needs and disability (Send) provision, adult social care, and temporary accommodation.
“We are taking creative strategies but certain measures require time to deliver both better provisions and financial savings,” said a council leader.
He continued: “There are demographic pressures which will persist to add to the pressures we have. As a unitary authority, we had a 91% cut in our central funding from 2010-24, which is very challenging.”
Countrywide Trends and Projections
Research of county councils recently also found council budgets being stretched by the increasing figures of children and adults needing Send support.
The County Councils Network said that local shortfalls will hit 4.4 billion pounds a year by the end of the decade, as they struggle to manage rising needs.
Government officials have delayed planned reforms to the special educational needs framework until next year after a white paper setting out those reforms was recently delayed.
Disadvantage and Financial Gaps
According to the latest deprivation measures (the Index of Multiple Deprivation) for UK local authorities, several 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 top 30 across the country under the 2025 IMD measures,” noted the study.
“While only a single urban area is in the ten most deprived for disadvantaged communities nationally, cities are far more likely to be in the worst-off 20% of England. The data highlights the scale of challenges confronting local leaders across major urban centers in the next twelve months,” the report added.
“Council officials have been clear about the need for a fair and sustainable financial structure that accounts for and responds to the actual extent of disadvantage and need,” stated Michael Mordey.
“Without this, local authorities will persist to face impossible choices around which essential services to allocate spend to, and which to reduce, to the detriment of their communities.”
One in five of local authorities have cut or compromised social care provision in the last year, the study found.
