According to a latest poll of local authorities, UK councils are planning to sell community centers, sports centres, and retail spaces as they rely on a fire sale of properties to balance the books.
Growing Fiscal Challenges Drive Asset Sales
The Key Cities Group for second-tier cities in the UK stated that six out of ten of councils are planning to dispose of properties to cover the rising costs of adult and children’s social care.
Local governments have previously come under fire for disposing of public land and land to shore up their budgets, but they argue they must continue to raise vital cash from asset sales or face insolvency.
This coalition noted that a high proportion of councils attempting to raise money from a quick sale of assets represented “a clear change from 2024, when the majority (six in ten) of local leaders said they would prioritise service redesigns and using savings to manage growing financial challenges.”
Detailed Examples of Proposed Disposals
One local authority in southeast England announced its asset disposal plan included the sale of a shopping centre in a local town and a social club in another town to generate 20 million pounds over five years.
- A local golf course and business parks held in two English counties, which all generate rent for Medway council, will additionally be sold under the plan.
Council Tax Increases and Wider Financial Strains
The survey of councils in the key cities group, which includes Sunderland, Southampton, Gloucester and Salford, also found that more than 70% of authorities will need to raise council taxes next spring to address the rising cost of essential services, increased rates of housing insecurity, and a longstanding housing shortage.
Medway council explained it will press ahead with property disposals after sharp increases in the cost of youth support, support for vulnerable learners, adult social care, and short-term housing.
“We are adopting creative strategies but certain measures take time to achieve both better provisions and cost efficiency,” said a council leader.
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 revenue support grant from 2010-24, which is very challenging.”
Countrywide Trends and Projections
A survey of county councils recently also found council budgets being strained by the growing number of children and adults requiring special educational assistance.
A network of councils projected that local shortfalls will hit 4.4 billion pounds a year by 2029, as they struggle to manage increased demand.
Ministers have delayed scheduled changes to the special educational needs framework until the coming year after a policy document setting out those reforms was recently delayed.
Deprivation and Funding Gaps
According to the most recent indices of deprivation (the Index of Multiple Deprivation) for UK local authorities, many participating urban areas were among the most disadvantaged in England.
- “Member cities like several major towns place in the most deprived 30 nationally under the 2025 IMD measures,” said the report.
“While only one key city is among the top 10 for deprived neighbourhoods countrywide, urban areas are far more likely to be in the worst-off 20% of England. The figures highlights the extent of difficulties facing municipal officials across key cities in the coming year,” the report concluded.
“Council officials have been clear about the necessity for a equitable and lasting funding system that reflects and addresses the real levels of disadvantage and need,” stated a council leader.
“Without this, councils will persist to face difficult decisions around which essential services to fund, and which to cut, to the detriment of their communities.”
A fifth of local authorities have cut or compromised care services in the past 12 months, the survey found.
