Based on a new survey of municipal councils, UK councils are preparing to offload community centers, sports centres, and shopping arcades as they bet on a rapid disposal of properties to balance the books.
Increasing Financial Pressures Drive Asset Sales
The Key Cities Group for major urban areas in the UK stated that 60% of councils are intending to sell assets to meet the escalating costs of social services for vulnerable individuals.
Councils have in the past faced criticism for disposing of playing fields and land to support their budgets, but they contend they must proceed to raise vital cash from property disposals or face insolvency.
The group said that a significant number of authorities attempting to raise money from a quick sale of holdings marked “a clear change from 2024, when the majority (60%) of municipal officials stated they would focus on service redesigns and using savings to weather growing fiscal pressures.”
Specific Examples of Proposed Disposals
One local authority in southeast England said its asset disposal plan included the sale of a retail complex in a local town and a social club in Rochester to generate £20m over the next half-decade.
- Gillingham golf club and business parks held in two English counties, which all provide rental income for the authority, will additionally be sold under the plan.
Council Tax Increases and Wider Financial Pressures
This research of local authorities in the key cities group, which covers several urban centers, also found that more than 70% of councils will need to increase local levies next spring to cover the growing cost of essential services, increased rates of housing insecurity, and a persistent housing shortage.
The authority explained it will proceed with property disposals after sharp increases in the cost of children services, support for vulnerable learners, elderly and disability services, and short-term housing.
“We are adopting creative strategies but certain measures require time to achieve both improved services and cost efficiency,” stated a council leader.
He added: “There are population challenges which will persist to add to the strains we have. As a unitary authority, we had a drastic reduction in our revenue support grant from 2010-24, which is extremely difficult.”
Countrywide Patterns and Projections
A survey of county councils recently further found council budgets being stretched by the growing number of young people and older individuals needing Send support.
The County Councils Network projected that local shortfalls will reach £4.4bn a year by the end of the decade, as they grapple to cope with increased demand.
Government officials have put off planned reforms to the Send system until next year after a policy document outlining those reforms has been postponed.
Disadvantage and Financial Gaps
Based on the most recent deprivation measures (the Index of Multiple Deprivation) for UK local authorities, many participating urban areas were included in the most disadvantaged in England.
- “Member cities like several major towns place in the most deprived 30 nationally under the 2025 deprivation indices,” noted the study.
“While only one key city is in the top 10 for deprived neighbourhoods nationally, urban areas are far more likely 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 report added.
“Local government leaders have been explicit about the necessity for a fair and sustainable funding system that accounts for and responds to the actual extent of deprivation and need,” stated a council leader.
“Lacking this, local authorities will persist to face impossible choices around which essential services to fund, and which to reduce, to the disadvantage of their residents.”
A fifth of local authorities have reduced or weakened social care provision in the past 12 months, the survey revealed.
