Based on a latest study of local authorities, UK councils are preparing to offload community centers, athletic facilities, and shopping arcades as they bet on a rapid disposal of properties to stabilize finances.
Growing Financial Pressures Drive Asset Sales
A coalition of councils for second-tier cities in the UK reported that six out of ten of councils are planning to dispose of properties to cover the escalating costs of adult and children’s social care.
Councils have in the past come under fire for selling public land 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 significant number of authorities attempting to generate funds from a fire sale of holdings represented “a distinct shift from 2024, when the largest share (60%) of local leaders said they would focus on service redesigns and using financial reserves to manage growing financial challenges.”
Specific Cases of Proposed Disposals
Medway Council in southeast England announced its asset disposal plan featured the disposal of a shopping centre in Rainham and a social club in another town to generate £20m over five years.
- Gillingham golf club and business parks owned in two English counties, which all generate rent for the authority, will additionally be disposed of under the strategy.
Council Tax Rises and Wider Fiscal Strains
The survey of local authorities in the key cities group, which covers Sunderland, Southampton, Gloucester and Salford, further found that over seven in ten of councils will need to raise council taxes next April to address the rising cost of core provisions, increased rates of housing insecurity, and a persistent accommodation deficit.
Medway council explained it will proceed with asset sales after sharp increases in the cost of children services, special educational needs and disability (Send) provision, elderly and disability services, and temporary accommodation.
“We are adopting creative strategies but certain measures take time to deliver both better provisions and cost efficiency,” stated Vince Maple.
He continued: “There are demographic pressures which will continue to add to the strains we have. As a local government body, we had a drastic reduction in our central funding from over the past decade, which is very challenging.”
National Trends and Forecasts
A survey of regional authorities recently further found local finances 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 £4.4bn a year by the end of the decade, as they grapple to cope with rising needs.
Ministers have delayed scheduled changes to the Send system until the coming year after a policy document setting out those reforms was recently delayed.
Deprivation and Funding Shortfalls
Based on the latest indices of deprivation (the Index of Multiple Deprivation) covering UK local authorities, many key cities members were included in the most disadvantaged 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,” said the report.
“Although only one key city is among the top 10 for disadvantaged communities nationally, cities are much more prone to be in the most deprived fifth of England. The figures underscores the scale of difficulties confronting local leaders across key cities in the coming year,” the report concluded.
“Council officials have been clear about the necessity for a fair and sustainable financial structure that reflects and addresses the actual extent of deprivation and need,” said Michael Mordey.
“Without this, councils will persist to face difficult decisions around which essential services to allocate spend to, and which to cut, to the disadvantage of their communities.”
A fifth of local authorities have reduced or weakened social care provision in the last year, the study found.
