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According to a new survey of local authorities, UK councils are planning to offload social clubs, sports centres, and retail spaces as they bet on a rapid disposal of assets to balance the books.

Increasing Fiscal Challenges Drive Asset Sales

A coalition of councils for second-tier cities in England reported that six out of ten of local authorities are intending to dispose of properties to meet the rising costs of adult and children’s social care.

Local governments have in the past faced criticism for selling playing fields and land to shore up their budgets, but they contend they must proceed to generate essential revenue from asset sales or declare themselves bankrupt.

The group noted that a high proportion of authorities seeking to generate funds from a fire sale of holdings represented “a distinct shift from 2024, when the majority (six in ten) of municipal officials stated they would prioritise service redesigns and using savings to manage growing fiscal pressures.”

Specific Examples of Proposed Disposals

Medway Council in Kent announced its property management strategy featured the disposal of a retail complex in Rainham and a social club in Rochester to generate £20m over five years.

• Gillingham golf club and business parks owned in Worcestershire and Suffolk, which all provide rental income for the authority, will additionally be sold under the strategy.

Local Levy Increases and Broader Financial Pressures

The survey of councils in the coalition, which includes several urban centers, further found that more than 70% of authorities will have to raise local levies next April to address the growing cost of essential services, higher levels of homelessness, and a longstanding accommodation deficit.

Medway council explained it will press ahead with asset sales after sharp increases in the cost of children services, support for vulnerable learners, elderly and disability services, and short-term housing.

“We are adopting innovative approaches but certain measures take time to deliver both better provisions and financial savings,” said a council leader.

He added: “We face population challenges which will persist to increase the pressures we have. As a unitary authority, we had a 91% cut in our central funding from 2010-24, which is extremely difficult.”

National Trends and Forecasts

A survey of regional authorities recently also found local finances being strained by the increasing figures of children 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 manage increased demand.

Ministers have delayed scheduled changes to the special educational needs framework until the coming year after a policy document outlining those reforms was recently delayed.

Disadvantage and Funding Shortfalls

Based on the latest deprivation measures (the Index of Multiple Deprivation) covering UK local authorities, several participating urban areas were included in the most disadvantaged in England.

• “Member cities like several major towns place in the top 30 nationally under the latest deprivation indices,” noted the study.

“Although only a single urban area is in the ten most deprived for deprived neighbourhoods nationally, cities are far more likely to be in the most deprived fifth of England. The data highlights the extent of challenges facing municipal officials across key cities in the next twelve months,” the report concluded.

“Local government leaders have been explicit about the need for a fair and sustainable financial structure that accounts for and addresses the real levels of disadvantage and demand,” stated Michael Mordey.

“Lacking this, local authorities will continue to face difficult decisions around which essential services to allocate spend to, and which to cut, to the disadvantage of their residents.”

A fifth of councils have reduced or weakened care services in the last year, the study revealed.