Based on a recent study of local authorities, English councils are preparing to sell community centers, sports centres, and retail spaces as they rely on a fire sale of assets to stabilize finances.
Growing Fiscal Challenges Drive Asset Sales
The Key Cities Group representing second-tier cities in England stated that six out of ten of local authorities are intending to dispose of properties to cover the escalating costs of adult and children’s social care.
Councils have previously come under fire for disposing of playing fields and open spaces to shore up their finances, but they contend they must continue to raise vital cash from asset sales or face insolvency.
The group noted that a high proportion of authorities seeking to raise money from a fire sale of holdings represented “a clear change from 2024, when the largest share (six in ten) of local leaders said they would focus on restructuring services and using savings to weather increasing fiscal pressures.”
Specific Examples of Planned Disposals
One local authority in Kent said its property management strategy featured the disposal of a shopping centre in Rainham and a social club in Rochester to generate 20 million pounds over the next half-decade.
- A local golf course and commercial properties owned in Worcestershire and Suffolk, which all provide rental income for Medway council, will also be sold under the plan.
Council Tax Rises and Broader Financial Strains
This research of councils in the key cities group, which includes Sunderland, Southampton, Gloucester and Salford, further found that more than 70% of councils will have to raise council taxes next April to address the growing cost of essential services, higher levels of housing insecurity, and a persistent housing shortage.
Medway council said it will proceed 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 taking innovative approaches but some of these require time to achieve both better provisions and cost efficiency,” stated Vince Maple.
He continued: “We face demographic pressures which will persist to increase the strains we have. As a unitary authority, we had a 91% cut in our revenue support grant from 2010-24, which is extremely difficult.”
National Trends and Forecasts
A survey of county councils recently further found council budgets being strained by the growing number of young people and adults needing Send support.
A network of councils projected that council deficits will reach 4.4 billion pounds 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 the coming year after a white paper outlining those reforms has been postponed.
Deprivation and Funding Gaps
Based on the most recent deprivation measures (the Index of Multiple Deprivation) for English councils, several key cities members were among the most deprived in England.
- “Member cities like Hull, Bradford, Stoke-on-Trent, Sunderland and Wolverhampton place in the top 30 nationally under the 2025 IMD measures,” said the report.
“Although only a single urban area is among the top 10 for disadvantaged communities countrywide, cities are much more prone to be in the worst-off 20% of England. The data underscores the extent of challenges facing municipal officials across major urban centers in the coming year,” the report concluded.
“Local government leaders have been explicit about the need for a equitable and lasting financial structure that reflects and responds to the actual extent of deprivation and need,” stated Michael Mordey.
“Without this, local authorities will continue to face difficult decisions around which vital provisions to allocate spend to, and which to cut, to the detriment of their residents.”
A fifth of councils have reduced or weakened social care provision in the last year, the study found.
