According to a latest study of municipal councils, UK councils are preparing to sell community centers, sports centres, and shopping arcades as they rely on a fire sale of properties to balance the books.
Increasing Financial Pressures Drive Asset Sales
The Key Cities Group representing second-tier cities in the UK reported that 60% of councils are planning to dispose of properties to cover the rising costs of adult and children’s social care.
Councils have in the past come under fire for selling 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 high proportion of authorities seeking to generate funds from a quick sale of assets marked “a distinct shift from 2024, when the largest share (60%) of municipal officials said they would focus on service redesigns and utilising savings to manage growing financial challenges.”
Specific Examples of Proposed Disposals
Medway Council in southeast England said its property management strategy included the disposal of a shopping centre in a local town and a community venue in Rochester to generate £20m over the next half-decade.
- Gillingham golf club and commercial properties held in two English counties, which all provide rental income for the authority, will also be sold under the strategy.
Council Tax Increases and Broader Financial Pressures
The survey of local authorities in the key cities group, which covers several urban centers, also found that over seven in ten of councils will need to raise council taxes next spring to address the growing cost of core provisions, increased rates of homelessness, and a longstanding accommodation deficit.
The authority said it will proceed with asset sales after sharp increases in the cost of youth support, support for vulnerable learners, elderly and disability services, and short-term housing.
“We are taking creative strategies but certain measures take time to deliver both improved services and financial savings,” stated Vince Maple.
He added: “We face population challenges which will continue to add to the pressures we have. As a unitary authority, we had a 91% cut in our revenue support grant from 2010-24, which is extremely difficult.”
Countrywide Patterns and Forecasts
Research of county councils this week further found council budgets being stretched by the increasing figures of children and older individuals requiring special educational assistance.
A network of councils projected that council deficits will hit £4.4bn a year by the end of the decade, as they grapple to manage increased demand.
Ministers have delayed scheduled changes to the special educational needs framework until next year after a policy document outlining those reforms was recently delayed.
Disadvantage and Financial Shortfalls
Based on the most recent indices of deprivation (IMD) covering English councils, several participating urban areas were included in the most deprived in the country.
- “Member cities like Hull, Bradford, Stoke-on-Trent, Sunderland and Wolverhampton rank in the most deprived 30 across the country under the 2025 deprivation indices,” noted the report.
“While only a single urban area is in the top 10 for deprived neighbourhoods countrywide, urban areas are much more prone to be in the worst-off 20% of the nation. The figures underscores the scale of difficulties confronting local leaders across key cities in the next twelve months,” the report added.
“Local government leaders have been explicit about the necessity for a equitable and lasting financial structure that reflects and addresses the real levels of deprivation and need,” stated Michael Mordey.
“Without this, councils will persist to face impossible choices around which vital provisions to fund, and which to cut, to the detriment of their residents.”
One in five of councils have cut or compromised social care provision in the last year, the study revealed.
