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Based on a latest poll of local authorities, UK councils are planning to offload community centers, athletic facilities, and retail spaces as they bet on a fire sale of properties to balance the books.

Growing Fiscal Pressures Prompt Asset Sales

A coalition of councils representing major urban areas in the UK reported that six out of ten of local authorities are planning to dispose of properties to cover the escalating costs of adult and children’s social care.

Local governments have previously faced criticism for selling playing fields and land to support their budgets, but they argue they must continue to raise vital cash from property disposals or face insolvency.

This coalition said that a high proportion of authorities seeking to generate funds from a fire sale of assets represented “a distinct shift from 2024, when the largest share (six in ten) of local leaders said they would focus on restructuring services and utilising savings to weather increasing financial challenges.”

Detailed Examples of Planned Sales

Medway Council in southeast England said its asset disposal plan included the disposal of a retail complex in Rainham and a social club in Rochester to raise £20m over five years.

• A local golf course and business parks held in Worcestershire and Suffolk, which all generate rent for Medway council, will additionally be disposed of under the strategy.

Local Levy Rises and Wider Financial Strains

This research of councils in the key cities group, which covers several urban centers, also found that more than 70% of authorities will need to increase local levies next April to cover the growing cost of core provisions, increased rates of homelessness, and a longstanding housing shortage.

The authority said it will proceed with property disposals after steep rises in the cost of youth support, special educational needs and disability (Send) provision, adult social care, and temporary accommodation.

“We are taking innovative approaches but certain measures require time to deliver both improved services and financial savings,” said a council leader.

He continued: “We face population challenges which will continue to increase the strains 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 this week further found local finances being stretched by the growing number of children and adults needing Send support.

The County Councils Network projected that local shortfalls will reach £4.4bn a year by the end of the decade, as they grapple to cope with rising needs.

Ministers have delayed planned reforms to the special educational needs framework until the coming year after a white paper outlining those reforms was recently delayed.

Disadvantage and Financial Shortfalls

According to the most recent indices of deprivation (IMD) covering English councils, many participating urban areas were among the most disadvantaged in England.

• “Participating urban centers like several major towns rank in the most deprived 30 nationally under the latest deprivation indices,” noted the report.

“While only one key city is in the ten most deprived for deprived neighbourhoods nationally, cities are much more prone to be in the worst-off 20% of the nation. The figures underscores the extent of difficulties facing municipal officials across key cities in the coming year,” the report concluded.

“Council officials have been explicit about the necessity for a fair and sustainable funding system that accounts for and responds to the real levels of disadvantage and need,” stated a council leader.

“Without this, local authorities will persist to face difficult decisions around which vital provisions to allocate spend to, and which to reduce, to the disadvantage of their communities.”

A fifth of local authorities have reduced or weakened social care provision in the past 12 months, the survey found.