Based on a latest survey of municipal councils, English councils are preparing to sell social clubs, sports centres, and retail spaces as they rely on a fire sale of assets to balance the books.
Increasing Fiscal Challenges Prompt Asset Sales
A coalition of councils for second-tier cities in the UK stated that six out of ten of councils are intending to dispose of properties to cover the escalating costs of social services for vulnerable individuals.
Local governments have previously faced criticism for selling playing fields and land to shore up their finances, but they argue they must proceed to generate essential revenue from property disposals or face insolvency.
The group said that a high proportion of councils attempting to generate funds from a quick sale of assets marked “a distinct shift from 2024, when the majority (60%) of local leaders stated they would prioritise service redesigns and using savings to manage growing financial challenges.”
Specific Examples of Planned Sales
Medway Council in southeast England announced its asset disposal plan included the disposal of a shopping centre in a local town and a social club in Rochester to generate £20m over five years.
- Gillingham golf club and business parks held in Worcestershire and Suffolk, which all provide rental income for Medway council, will also be sold under the strategy.
Local Levy Increases and Broader Financial Pressures
The survey of local authorities in the key cities group, which includes Sunderland, Southampton, Gloucester and Salford, also found that over seven in ten of authorities will need to increase local levies next spring to address the rising cost of essential services, increased rates of homelessness, and a longstanding housing shortage.
The authority said it will press ahead with asset sales after steep rises in the cost of youth support, special educational needs and disability (Send) provision, elderly and disability services, and short-term housing.
“We are taking innovative approaches but some of these require time to achieve both better provisions and cost efficiency,” stated a council leader.
He added: “There are demographic pressures which will persist to add to the strains we have. As a local government body, we had a 91% cut in our central funding from 2010-24, which is extremely difficult.”
National Trends and Forecasts
Research of regional authorities this week further found local finances being stretched by the growing number of children and adults 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 manage increased demand.
Government officials have put off planned reforms to the special educational needs framework until next year after a policy document outlining those reforms has been postponed.
Deprivation and Financial Gaps
According to the most recent deprivation measures (IMD) for UK local authorities, many participating urban areas were among the most deprived in England.
- “Member cities like several major towns rank in the most deprived 30 across the country under the 2025 deprivation indices,” noted the report.
“While only a single urban area is among the top 10 for disadvantaged communities countrywide, cities are far more likely to be in the most deprived fifth of the nation. The data highlights the extent of difficulties confronting local leaders across key cities in the coming year,” the analysis concluded.
“Council officials have been clear about the necessity for a fair and sustainable funding system that reflects and addresses the actual extent of deprivation and demand,” said a council leader.
“Lacking this, councils will persist to face impossible choices around which vital provisions to allocate spend to, and which to cut, to the disadvantage of their residents.”
One in five of local authorities have reduced or weakened care services in the last year, the study revealed.
