According to a latest study of municipal councils, English councils are planning to sell community centers, athletic facilities, and retail spaces as they bet on a rapid disposal of properties to balance the books.
Increasing Fiscal Pressures Drive Asset Sales
A coalition of councils representing second-tier cities in the UK reported that six out of ten of local authorities are planning to dispose of properties to meet the escalating costs of adult and children’s social care.
Local governments have in the past come under fire for selling playing fields and open spaces to support their finances, but they contend they must continue to generate essential revenue from asset sales or face insolvency.
The group said that a high proportion of authorities attempting to generate funds from a quick sale of holdings marked “a distinct shift from 2024, when the majority (six in ten) of local leaders said they would prioritise service redesigns and utilising savings to weather increasing fiscal pressures.”
Specific Examples of Planned Disposals
Medway Council in Kent said its property management strategy included the disposal of a shopping centre in a local town and a community venue in Rochester to raise £20m over the next half-decade.
- Gillingham golf club and business parks held 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 coalition, which includes several urban centers, further found that over seven in ten of authorities will have to increase council taxes next April to cover the growing cost of core provisions, increased rates of housing insecurity, and a persistent housing shortage.
Medway council explained it will proceed with asset sales after sharp increases in the cost of youth support, special educational needs and disability (Send) provision, elderly and disability services, and temporary accommodation.
“We are adopting innovative approaches but certain measures take time to achieve both better provisions and financial savings,” said Vince Maple.
He continued: “We face population challenges which will continue to add to the pressures we have. As a local government body, we had a drastic reduction in our central funding from 2010-24, which is very challenging.”
National Patterns and Projections
A survey of county councils this week also found council budgets being strained by the increasing figures of children and older individuals needing Send support.
The County Councils Network said that council deficits will reach 4.4 billion pounds a year by the end of the decade, as they grapple to manage rising needs.
Government officials have delayed scheduled changes to the Send system until next year after a white paper setting out those reforms has been postponed.
Disadvantage and Financial Shortfalls
According to the latest deprivation measures (the Index of Multiple Deprivation) for English councils, many key cities members were included in the most deprived in the country.
- “Participating urban centers like Hull, Bradford, Stoke-on-Trent, Sunderland and Wolverhampton rank in the most deprived 30 across the country under the latest deprivation indices,” said the report.
“While only a single urban area is among the top 10 for deprived neighbourhoods countrywide, cities are far more likely to be in the worst-off 20% of England. The data underscores the scale of difficulties confronting municipal officials across key cities in the coming year,” the report concluded.
“Local government leaders have been explicit about the need for a fair and sustainable funding system that accounts for and responds to the real levels of deprivation and need,” said Michael Mordey.
“Lacking this, councils will persist to face difficult decisions around which vital provisions to allocate spend to, and which to cut, to the detriment of their residents.”
A fifth of local authorities have reduced or weakened social care provision in the past 12 months, the survey found.
