According to a latest survey of local authorities, UK councils are planning to sell social clubs, athletic facilities, and retail spaces as they bet on a rapid disposal of properties to balance the books.
Increasing Fiscal Challenges Prompt Asset Sales
The Key Cities Group representing major urban areas in the UK 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.
Councils have previously faced criticism for disposing of playing fields and land to shore up their budgets, but they argue they must proceed to raise vital cash from asset sales or declare themselves bankrupt.
The group noted that a significant number of authorities seeking to generate funds from a quick sale of holdings marked “a clear change from 2024, when the largest share (60%) of municipal officials stated they would focus on restructuring services and using financial reserves to weather increasing fiscal pressures.”
Specific Cases of Planned Sales
Medway Council in Kent said its asset disposal plan featured the disposal of a retail complex in a local town and a community venue in Rochester to raise £20m over five years.
- Gillingham golf club and commercial properties held in two English counties, which all generate rent for the authority, will additionally be sold under the plan.
Local Levy Rises and Broader Financial Strains
This research of councils in the coalition, which covers several urban centers, also found that more than 70% of authorities will have to increase local levies next April to address the growing cost of essential services, higher levels of housing insecurity, and a longstanding accommodation deficit.
Medway council explained it will press ahead with asset sales after steep rises in the cost of children services, special educational needs and disability (Send) provision, adult social care, and temporary accommodation.
“We are taking innovative approaches but some of these take time to achieve both improved services and cost efficiency,” said Vince Maple.
He added: “We face demographic pressures which will persist to increase the pressures we have. As a local government body, we had a 91% cut in our revenue support grant from 2010-24, which is extremely difficult.”
Countrywide Patterns and Forecasts
Research of regional authorities this week further found local finances being strained by the increasing figures of children and adults needing special educational assistance.
A network of councils said that local shortfalls will hit £4.4bn a year by 2029, as they grapple to cope with rising needs.
Ministers have put off scheduled changes to the Send system until next year after a policy document outlining those changes was recently delayed.
Disadvantage and Funding Gaps
According to the most recent deprivation measures (the Index of Multiple Deprivation) covering UK local authorities, several key cities members were among the most disadvantaged in England.
- “Member cities like Hull, Bradford, Stoke-on-Trent, Sunderland and Wolverhampton place in the top 30 nationally under the latest deprivation indices,” said the study.
“Although only a single urban area is in the ten most deprived for disadvantaged communities countrywide, cities are far more likely to be in the most deprived fifth of England. The figures underscores the scale of difficulties facing local leaders across major urban centers in the coming year,” the report added.
“Council officials have been explicit about the need for a fair and sustainable financial structure that reflects and addresses the real levels of deprivation and need,” said Michael Mordey.
“Without this, local authorities will persist to face impossible choices around which vital provisions to allocate spend to, and which to reduce, to the disadvantage of their communities.”
One in five of local authorities have cut or compromised social care provision in the past 12 months, the survey revealed.
