Based on a new survey of local authorities, English councils are preparing to sell social clubs, sports centres, and shopping arcades as they bet on a rapid disposal of properties to balance the books.
Increasing Fiscal Pressures Drive Asset Sales
A coalition of councils for second-tier cities in England stated that 60% of local authorities are intending to sell assets to cover the escalating costs of social services for vulnerable individuals.
Local governments have previously faced criticism for disposing of playing fields and land to shore up their budgets, but they argue they must continue to generate essential revenue from asset sales or declare themselves bankrupt.
This coalition noted that a high proportion of authorities attempting 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 prioritise restructuring services and using financial reserves to manage growing financial challenges.”
Detailed Examples of Planned Disposals
One local authority in Kent said its asset disposal plan included the disposal of a shopping centre in Rainham and a community venue in Rochester to raise 20 million pounds over five years.
- Gillingham golf club and commercial properties owned in two English counties, which all generate rent for the authority, will also be sold under the strategy.
Council Tax Rises and Wider Fiscal Strains
This research of councils in the coalition, which includes several urban centers, also found that over seven in ten of councils will need to raise local levies next spring to cover the growing cost of essential services, increased rates of housing insecurity, and a longstanding housing shortage.
The authority said it will proceed with asset sales after sharp increases in the cost of youth support, support for vulnerable learners, adult social care, and short-term housing.
“We are adopting innovative approaches but some of these require time to deliver both better provisions and financial savings,” stated Vince Maple.
He added: “There are population challenges which will continue to increase the pressures we have. As a unitary authority, we had a 91% cut in our central funding from 2010-24, which is very challenging.”
National Trends and Forecasts
Research of regional authorities this week also found council budgets being strained by the growing number of young people and older individuals requiring Send support.
The County Councils Network projected that local shortfalls will reach 4.4 billion pounds a year by the end of the decade, as they grapple to cope with increased demand.
Ministers have put off planned reforms to the special educational needs framework until the coming year after a white paper setting out those reforms was recently delayed.
Deprivation and Financial Shortfalls
According to the latest deprivation measures (the Index of Multiple Deprivation) covering English councils, several participating urban areas were included in the most deprived in the country.
- “Participating urban centers like Hull, Bradford, Stoke-on-Trent, Sunderland and Wolverhampton rank in the most deprived 30 nationally under the latest deprivation indices,” said the report.
“Although only a single urban area is in the ten most deprived for deprived neighbourhoods countrywide, urban areas are much more prone to be in the worst-off 20% of the nation. The figures highlights the extent of challenges confronting local leaders across major urban centers in the coming year,” the report added.
“Local government leaders have been clear about the necessity for a fair and sustainable funding system that accounts for and responds to the actual extent of disadvantage and need,” said Michael Mordey.
“Lacking this, councils will persist to face impossible choices around which essential services to fund, and which to cut, to the disadvantage of their residents.”
One in five of local authorities have reduced or weakened social care provision in the last year, the survey revealed.
