Based on a latest study of municipal councils, UK councils are preparing to sell community centers, athletic facilities, and shopping arcades as they rely on a fire sale of properties to stabilize finances.
Increasing Financial Challenges Prompt Asset Sales
A coalition of councils for second-tier cities in England stated that six out of ten of local authorities are planning to sell assets to meet the escalating costs of adult and children’s social care.
Councils have in the past come under fire for disposing of public land and open spaces to support their budgets, but they argue they must proceed to generate essential revenue from property disposals or face insolvency.
This coalition noted that a significant number of authorities seeking to raise money from a fire sale of assets marked “a clear change from 2024, when the majority (six in ten) of municipal officials stated they would focus on service redesigns and utilising savings to manage increasing financial challenges.”
Detailed Cases of Proposed Disposals
One local authority in Kent said its property management strategy featured the sale of a shopping centre in a local town and a community venue in another town to generate £20m over five years.
- Gillingham golf club and commercial properties held in two English counties, which all provide rental income for Medway council, will also be sold under the strategy.
Council Tax Increases and Broader Financial Pressures
The survey of councils in the coalition, which includes several urban centers, further found that more than 70% of councils will need to raise council taxes next spring to cover the rising cost of core provisions, increased rates of housing insecurity, and a longstanding accommodation deficit.
Medway council explained it will proceed with property disposals after steep rises in the cost of children services, special educational needs and disability (Send) provision, adult social care, and short-term housing.
“We are adopting creative strategies but some of these require time to deliver both improved services and financial savings,” said a council leader.
He added: “We face demographic pressures which will continue to add to the strains we have. As a unitary authority, we had a 91% cut in our revenue support grant from over the past decade, which is very challenging.”
National Patterns and Forecasts
A survey of county councils recently also found council budgets being strained by the increasing figures of children and older individuals needing special educational assistance.
A network of councils said that council deficits will hit 4.4 billion pounds a year by the end of the decade, as they grapple to cope with rising needs.
Ministers have put off planned reforms to the Send system until next year after a white paper outlining those reforms was recently delayed.
Deprivation and Financial Gaps
Based on the latest deprivation measures (the Index of Multiple Deprivation) covering English councils, several key cities members were among the most disadvantaged in the country.
- “Member cities like Hull, Bradford, Stoke-on-Trent, Sunderland and Wolverhampton rank in the top 30 across the country under the 2025 IMD measures,” noted the report.
“While only one key city is among the ten most deprived for disadvantaged communities countrywide, urban areas are much more prone to be in the most deprived fifth of England. The data underscores the extent of challenges confronting municipal officials across major urban centers in the coming year,” the report added.
“Council officials have been clear about the necessity for a equitable and lasting financial structure that accounts for and addresses the actual extent of disadvantage and demand,” said Michael Mordey.
“Without this, councils will persist to face impossible choices around which essential services to allocate spend to, and which to cut, to the disadvantage of their residents.”
A fifth of local authorities have cut or compromised care services in the past 12 months, the survey found.
