According to a new poll of municipal councils, English 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.
Growing Fiscal Pressures Prompt Asset Sales
The Key Cities Group for major urban areas in England reported that six out of ten of local authorities are intending to sell assets to cover the escalating costs of social services for vulnerable individuals.
Councils have previously come under fire for disposing of public land and land to support their budgets, but they argue they must continue to raise vital cash from asset sales or declare themselves bankrupt.
This coalition said that a high proportion of authorities attempting to generate funds from a quick sale of holdings marked “a clear change from 2024, when the majority (60%) of municipal officials said they would prioritise restructuring services and utilising savings to manage increasing fiscal pressures.”
Specific Cases of Proposed Disposals
One local authority in Kent announced its asset disposal plan featured the disposal of a shopping centre in a local town and a social club in Rochester to generate £20m over the next half-decade.
- Gillingham golf club and business parks owned in two English counties, which all provide rental income for the authority, will also be sold under the plan.
Council Tax Increases and Wider Fiscal Strains
This research of local authorities in the key cities group, which includes several urban centers, further found that over seven in ten of councils will have to raise council taxes next April to cover the growing cost of essential services, higher levels of housing insecurity, and a persistent housing shortage.
Medway council explained it will proceed with property disposals after sharp increases in the cost of youth support, special educational needs and disability (Send) provision, elderly and disability services, and short-term housing.
“We are taking innovative approaches but certain measures take time to achieve both better provisions and cost efficiency,” stated Vince Maple.
He continued: “There are population challenges which will continue to add to the pressures we have. As a unitary authority, we had a 91% cut in our central funding from over the past decade, which is very challenging.”
National Patterns and Projections
A survey of county councils this week also found local finances being strained by the growing number of young people and older individuals requiring Send support.
The County Councils Network projected that council deficits will hit 4.4 billion pounds a year by the end of the decade, as they grapple to manage increased demand.
Ministers have put off planned reforms to the Send system until next year after a policy document outlining those changes was recently delayed.
Disadvantage and Financial Gaps
According to the latest indices of deprivation (IMD) covering UK local authorities, several participating urban areas were among the most disadvantaged in England.
- “Participating urban centers like Hull, Bradford, Stoke-on-Trent, Sunderland and Wolverhampton place in the most deprived 30 across the country under the latest deprivation indices,” noted the report.
“Although only one key city is in the top 10 for disadvantaged communities nationally, cities are much more prone to be in the worst-off 20% of England. The data underscores the scale of difficulties facing local leaders across key cities in the next twelve months,” the analysis concluded.
“Local government leaders have been explicit about the necessity for a fair and sustainable financial structure that accounts for and addresses the real levels of disadvantage and need,” said Michael Mordey.
“Lacking this, councils will continue to face difficult decisions around which essential services to allocate spend to, and which to reduce, to the detriment of their residents.”
One in five of councils have reduced or weakened care services in the last year, the study revealed.
