Based on a latest poll of municipal councils, UK councils are preparing to sell social clubs, sports centres, and retail spaces as they bet on a fire sale of properties to balance the books.
Growing Financial Pressures Drive Asset Sales
A coalition of councils for second-tier cities in the UK stated that 60% of councils are intending to sell assets to meet the rising costs of social services for vulnerable individuals.
Councils have in the past faced criticism for selling public land and land to support their finances, but they contend they must continue to raise vital cash from property disposals or face insolvency.
The group said that a significant number of councils attempting to raise money from a fire sale of assets marked “a clear change from 2024, when the largest share (six in ten) of local leaders said they would focus on restructuring services and utilising savings to manage growing fiscal pressures.”
Specific Examples of Proposed Sales
One local authority in Kent announced its asset disposal plan included the disposal of a shopping centre in a local town and a social club in another town to raise £20m over the next half-decade.
- A local golf course and commercial properties held in Worcestershire and Suffolk, which all provide rental income for Medway council, will also be disposed of under the plan.
Council Tax Increases and Wider Financial Pressures
The survey of local authorities in the coalition, which includes several urban centers, further found that over seven in ten of councils will need to raise council taxes next April to address the rising cost of essential services, higher levels of housing insecurity, and a persistent accommodation deficit.
The authority said 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 innovative approaches but certain measures take time to achieve both improved services and cost efficiency,” said a council leader.
He continued: “We face demographic pressures which will continue to add to the pressures we have. As a local government body, we had a drastic reduction in our revenue support grant from 2010-24, which is extremely difficult.”
Countrywide Patterns and Forecasts
Research of county councils recently also found local finances being stretched by the growing number of young people and adults needing special educational assistance.
The County Councils Network projected that council deficits will hit £4.4bn a year by the end of the decade, as they grapple to cope with increased demand.
Ministers have delayed scheduled changes to the Send system until next year after a policy document setting out those reforms was recently delayed.
Deprivation and Financial Shortfalls
Based on the latest indices of deprivation (IMD) covering UK local authorities, many key cities members were among the most disadvantaged in England.
- “Member cities like several major towns rank in the most deprived 30 across the country under the 2025 IMD measures,” said the report.
“While only one key city is among the ten most deprived for disadvantaged communities countrywide, urban areas are far more likely to be in the worst-off 20% of England. The data underscores the extent of difficulties confronting municipal officials across key cities in the coming year,” the report added.
“Local government leaders have been clear about the need for a fair and sustainable funding system that accounts for and responds to the actual extent of deprivation and demand,” said 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 disadvantage of their communities.”
A fifth of local authorities have reduced or weakened care services in the last year, the survey revealed.
