Based on a latest survey of local authorities, UK councils are preparing to offload social clubs, athletic facilities, and shopping arcades as they bet on a fire sale of assets to stabilize finances.
Increasing Fiscal Challenges Prompt Asset Sales
The Key Cities Group for major urban areas in the UK stated that 60% of local authorities are planning to dispose of properties to meet the rising costs of adult and children’s social care.
Councils have in the past faced criticism for selling playing fields and land to shore up their finances, but they argue they must proceed to generate essential revenue from property disposals or declare themselves bankrupt.
The group said that a high proportion of authorities seeking to raise money from a fire sale of assets marked “a distinct shift from 2024, when the majority (six in ten) of municipal officials stated they would focus on restructuring services and utilising financial reserves to weather increasing fiscal pressures.”
Detailed Examples of Proposed Disposals
One local authority in southeast England said its asset disposal plan included the sale of a shopping centre in a local town and a community venue in Rochester to raise £20m over five years.
- A local golf course and business parks owned in Worcestershire and Suffolk, which all generate rent for the authority, will additionally be disposed of under the plan.
Local Levy Rises and Broader Financial Pressures
The survey of councils in the key cities group, which includes Sunderland, Southampton, Gloucester and Salford, further found that more than 70% of authorities will need to increase local levies next April to cover the growing cost of essential services, increased rates of housing insecurity, and a longstanding housing shortage.
Medway council explained it will press ahead with property disposals after sharp increases in the cost of children services, support for vulnerable learners, adult social care, and temporary accommodation.
“We are adopting creative strategies but some of these take time to achieve both better provisions and cost efficiency,” said a council leader.
He continued: “There are population challenges which will continue to increase the strains we have. As a local government body, we had a 91% cut in our revenue support grant from over the past decade, which is extremely difficult.”
National Trends and Projections
Research of regional authorities recently further found local finances being strained by the growing number of young people and older individuals needing special educational assistance.
A network of councils projected that local shortfalls will reach £4.4bn a year by 2029, as they grapple to cope with increased demand.
Government officials have put off scheduled changes to the special educational needs framework until next year after a policy document outlining those changes has been postponed.
Disadvantage and Funding Gaps
According to the latest deprivation measures (IMD) covering UK local authorities, many participating urban areas were included in the most deprived in England.
- “Member cities like several major towns rank in the most deprived 30 across the country under the 2025 deprivation indices,” noted the study.
“While only a single urban area is in the top 10 for disadvantaged communities nationally, cities are far more likely to be in the worst-off 20% of the nation. The figures highlights the scale of challenges facing municipal officials across key cities in the next twelve months,” the analysis concluded.
“Council officials have been clear about the necessity for a equitable and lasting funding system that reflects and responds to the actual extent of disadvantage and demand,” stated a council leader.
“Without this, local authorities will persist to face impossible choices around which essential services to allocate spend to, and which to cut, to the detriment of their residents.”
One in five of councils have reduced or weakened care services in the past 12 months, the study found.
