According to a recent study of municipal councils, UK councils are preparing to offload social clubs, sports centres, and shopping arcades as they rely on a fire sale of properties to stabilize finances.
Growing Financial Pressures Prompt Asset Sales
A coalition of councils for second-tier cities in England stated that six out of ten of councils are intending to sell assets to cover the rising costs of adult and children’s social care.
Local governments have previously faced criticism for disposing of playing fields and open spaces to support their budgets, but they contend they must proceed to raise vital cash from property disposals or face insolvency.
This coalition said 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 (60%) of municipal officials stated they would prioritise restructuring services and using savings to manage growing financial challenges.”
Specific Examples of Planned Sales
Medway Council in southeast England announced its property management strategy included the sale of a shopping centre in a local town and a community venue in Rochester to generate £20m over the next half-decade.
- Gillingham golf club and commercial properties owned in two English counties, which all provide rental income for Medway council, will also be disposed of under the plan.
Council Tax Rises and Wider Financial Pressures
The survey of councils in the key cities group, which includes Sunderland, Southampton, Gloucester and Salford, further found that over seven in ten of authorities will need to increase local levies next spring to address the rising cost of core provisions, increased rates of homelessness, and a longstanding accommodation deficit.
Medway council said it will press ahead with asset sales after sharp increases in the cost of children services, support for vulnerable learners, adult social care, and temporary accommodation.
“We are taking creative strategies but some of these require time to achieve both better provisions and financial savings,” said a council leader.
He continued: “We face population challenges which will persist to increase 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 Projections
Research of county councils this week also found council budgets being strained by the growing number of young people and older individuals needing special educational assistance.
The County Councils Network projected that local shortfalls will reach £4.4bn a year by the end of the decade, as they struggle to manage increased demand.
Government officials have put off planned reforms to the Send system until next year after a policy document outlining those reforms was recently delayed.
Deprivation and Funding Shortfalls
Based on the latest indices of deprivation (IMD) 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 most deprived 30 across the country under the 2025 deprivation indices,” noted the study.
“Although only one key city is among the top 10 for disadvantaged communities nationally, cities are much more prone to be in the worst-off 20% of the nation. The figures highlights the scale of challenges facing local leaders across key cities in the next twelve months,” the analysis concluded.
“Local government leaders have been clear about the need for a fair and sustainable funding system that accounts for and addresses the real levels of deprivation and demand,” said Michael Mordey.
“Lacking this, councils will continue to face difficult decisions around which vital provisions to fund, and which to cut, to the disadvantage of their communities.”
One in five of councils have reduced or weakened social care provision in the last year, the survey found.
