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Based on a latest study of local authorities, English councils are planning to sell community centers, athletic facilities, and shopping arcades as they rely on a fire sale of assets to stabilize finances.

Growing Fiscal Pressures Prompt Asset Sales

The Key Cities Group representing major urban areas in the UK stated that 60% of councils are intending to sell assets to meet the rising costs of social services for vulnerable individuals.

Local governments have previously come under fire for selling playing fields and open spaces to shore up their budgets, but they contend they must continue to raise vital cash from asset sales or declare themselves bankrupt.

The group noted that a significant number of authorities attempting to raise money from a quick sale of holdings marked “a distinct shift from 2024, when the majority (six in ten) of local leaders stated they would prioritise restructuring services and using financial reserves to manage increasing fiscal pressures.”

Specific Examples of Proposed Disposals

One local authority in Kent said its property management strategy included the sale of a retail complex in Rainham and a community venue in another town to generate £20m over five years.

• A local golf course and business parks held in Worcestershire and Suffolk, which all provide rental income for Medway council, will also be sold under the strategy.

Local Levy Increases and Broader Fiscal Pressures

This research of local authorities in the key cities group, which covers several urban centers, further found that more than 70% of councils will need to increase council taxes 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 adopting creative strategies but some of these take time to deliver both better provisions and cost efficiency,” said Vince Maple.

He continued: “We face demographic pressures which will persist to increase the pressures we have. As a unitary authority, we had a 91% cut in our central funding from 2010-24, which is extremely difficult.”

National Trends and Forecasts

A survey of county councils this week further found local finances being strained by the increasing figures of young people and older individuals requiring special educational assistance.

The County Councils Network projected that local shortfalls will reach 4.4 billion pounds a year by the end of the decade, as they grapple to manage increased demand.

Government officials have delayed scheduled changes to the special educational needs framework until the coming year after a policy document setting out those changes has been postponed.

Disadvantage and Funding Shortfalls

According to 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 latest deprivation indices,” noted the study.

“Although only a single urban area is in the top 10 for disadvantaged communities nationally, urban areas are far more likely to be in the most deprived fifth of England. The data underscores the scale of difficulties facing local leaders across major urban centers in the coming year,” the report added.

“Local government leaders have been clear about the need for a fair and sustainable funding system that reflects and responds to the actual extent of disadvantage and demand,” stated a council leader.

“Lacking this, local authorities will persist to face difficult decisions around which vital provisions to allocate spend to, and which to reduce, to the detriment of their communities.”

A fifth of councils have reduced or weakened social care provision in the past 12 months, the survey revealed.