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Based on a new survey of local authorities, UK councils are planning to offload community centers, sports centres, and retail spaces as they bet on a rapid disposal of assets to stabilize finances.

Increasing Fiscal Pressures Drive Asset Sales

The Key Cities Group representing second-tier cities in the UK stated that 60% of local authorities are intending to sell assets to cover the rising costs of adult and children’s social care.

Local governments have previously faced criticism for selling playing fields and open spaces to support their finances, but they contend they must continue to raise vital cash from asset sales or declare themselves bankrupt.

This coalition noted that a high proportion of authorities attempting to generate funds from a quick sale of holdings represented “a clear change from 2024, when the majority (six in ten) of local leaders stated they would focus on service redesigns and using financial reserves to weather growing financial challenges.”

Specific Cases of Proposed Disposals

One local authority in southeast England said its property management strategy featured the sale of a shopping centre in a local town and a community venue in Rochester to raise £20m over five years.

• Gillingham golf club and business parks owned in two English counties, which all provide rental income for the authority, will also be sold under the plan.

Council Tax Increases and Wider Financial Pressures

This research of local authorities in the key cities group, which includes several urban centers, further found that over seven in ten of councils will have to increase local levies next spring to address the rising cost of essential services, higher levels of homelessness, and a longstanding housing shortage.

The authority said it will proceed with asset sales after sharp increases in the cost of youth support, support for vulnerable learners, adult social care, and short-term housing.

“We are taking innovative approaches but certain measures require time to achieve both better provisions and financial savings,” said Vince Maple.

He continued: “We face population challenges which will persist to add to the pressures we have. As a local government body, we had a drastic reduction in our revenue support grant from over the past decade, which is extremely difficult.”

Countrywide Patterns and Forecasts

Research of county councils this week further found council budgets being stretched by the growing number of young people and adults requiring special educational assistance.

A network of councils said that council deficits 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 Send system until the coming year after a white paper setting out those reforms was recently delayed.

Deprivation and Funding Shortfalls

According to the most recent deprivation measures (the Index of Multiple Deprivation) covering UK local authorities, many key cities members were among the most disadvantaged in the country.

• “Member cities like several major towns place in the top 30 nationally under the latest deprivation indices,” said the study.

“Although only one key city is among the ten most deprived for disadvantaged communities countrywide, urban areas are much more prone to be in the most deprived fifth of the nation. The figures underscores the scale of difficulties confronting municipal officials across major urban centers in the coming year,” the report added.

“Council officials have been explicit about the need for a fair and sustainable financial structure that reflects and addresses the real levels of disadvantage and demand,” stated a council leader.

“Lacking this, local authorities will persist to face impossible choices around which vital provisions to allocate spend to, and which to reduce, to the disadvantage of their residents.”

A fifth of councils have cut or compromised care services in the past 12 months, the study revealed.