According to a latest poll of local authorities, UK councils are planning to offload community centers, sports centres, and retail spaces as they rely on a fire sale of assets to stabilize finances.
Increasing Fiscal Challenges Prompt Asset Sales
The Key Cities Group for second-tier cities in England reported that six out of ten of local authorities are planning to dispose of properties to meet the rising costs of social services for vulnerable individuals.
Local governments have in the past come under fire for selling public land and open spaces to shore up their budgets, but they argue they must continue to raise vital cash from property disposals or face insolvency.
The group said that a high proportion of authorities attempting to raise money from a fire sale of holdings represented “a clear change from 2024, when the majority (60%) of municipal officials said they would prioritise restructuring services and utilising savings to manage growing financial challenges.”
Detailed Examples of Proposed Disposals
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 business parks owned in Worcestershire and Suffolk, which all provide rental income for Medway council, will additionally be sold under the plan.
Local Levy Increases and Wider Fiscal Pressures
The survey of councils in the key cities group, which includes several urban centers, further found that over seven in ten of authorities will need to raise local levies next spring to cover the growing cost of essential services, increased rates of housing insecurity, and a persistent housing shortage.
Medway council said it will proceed with property disposals after steep rises in the cost of children services, special educational needs and disability (Send) provision, elderly and disability services, and temporary accommodation.
“We are taking innovative approaches but some of these require time to achieve both improved services and financial savings,” stated a council leader.
He added: “There are population challenges which will continue to add to the pressures we have. As a unitary authority, we had a drastic reduction in our central funding from 2010-24, which is very challenging.”
National Trends and Forecasts
Research of regional authorities recently further found council budgets being stretched by the growing number of young people and adults needing special educational assistance.
The County Councils Network projected that council deficits will reach £4.4bn a year by 2029, as they struggle to manage increased demand.
Government officials have delayed scheduled changes to the special educational needs framework until the coming year after a white paper setting out those reforms was recently delayed.
Deprivation and Funding Shortfalls
According to the latest deprivation measures (the Index of Multiple Deprivation) covering UK local authorities, many participating urban areas were included in the most disadvantaged in England.
- “Participating urban centers like Hull, Bradford, Stoke-on-Trent, Sunderland and Wolverhampton place in the top 30 across the country under the 2025 IMD measures,” noted the report.
“Although only one key city is in the ten most deprived for disadvantaged communities countrywide, cities are far more likely to be in the worst-off 20% of the nation. The figures highlights the extent of challenges facing local leaders across major urban centers in the next twelve months,” the report concluded.
“Local government leaders have been clear about the necessity for a fair and sustainable funding system that reflects and responds to the real levels of disadvantage and need,” said a council leader.
“Lacking this, councils will continue to face difficult decisions around which vital provisions to allocate spend to, and which to reduce, to the detriment of their residents.”
A fifth of councils have cut or compromised care services in the past 12 months, the survey revealed.
