According to a new study of municipal councils, English councils are planning to sell social clubs, sports centres, and shopping arcades as they rely on a rapid disposal of properties to stabilize finances.
Growing Fiscal Challenges Prompt Asset Sales
The Key Cities Group representing second-tier cities in the UK reported that six out of ten of councils are planning to dispose of properties to meet the rising costs of social services for vulnerable individuals.
Councils have previously faced criticism for disposing of public land and land to shore up their finances, but they argue they must proceed to generate essential revenue from property disposals or declare themselves bankrupt.
The group said that a high proportion of councils seeking to raise money from a quick sale of assets represented “a distinct shift from 2024, when the majority (six in ten) of local leaders stated they would prioritise service redesigns and using savings to weather growing fiscal pressures.”
Detailed Examples of Planned Sales
Medway Council in Kent announced its property management strategy featured the sale of a shopping centre in Rainham and a social club in another town to raise £20m over the next half-decade.
- Gillingham golf club and commercial properties owned in two English counties, which all provide rental income for the authority, will also be disposed of under the plan.
Local Levy Increases and Broader Financial Strains
This research of local authorities in the key cities group, which includes several urban centers, also found that over seven in ten of councils will need to increase council taxes next spring to cover the growing cost of core provisions, increased rates of homelessness, and a persistent accommodation deficit.
The authority said it will proceed with asset sales after sharp increases in the cost of children services, support for vulnerable learners, elderly and disability services, and short-term housing.
“We are adopting innovative approaches but some of these take time to deliver both improved services and financial savings,” stated a council leader.
He continued: “We face demographic pressures which will persist to increase the strains we have. As a local government body, we had a drastic reduction in our central funding from over the past decade, which is very challenging.”
National Patterns and Forecasts
A survey of county councils recently also found council budgets being strained by the growing number of young people and adults requiring special educational assistance.
A network of councils said that council deficits will hit £4.4bn a year by 2029, as they grapple to cope with rising needs.
Ministers have put off planned reforms to the special educational needs framework until next year after a white paper setting out those reforms was recently delayed.
Deprivation and Financial Shortfalls
According to the latest deprivation measures (the Index of Multiple Deprivation) covering UK local authorities, several key cities members were included in the most disadvantaged in the country.
- “Participating urban centers like Hull, Bradford, Stoke-on-Trent, Sunderland and Wolverhampton place in the top 30 nationally under the 2025 IMD measures,” noted the report.
“While only one key city is among the ten most deprived for deprived neighbourhoods countrywide, cities are far more likely to be in the most deprived fifth of the nation. The data highlights the extent of challenges confronting local leaders across major urban centers in the next twelve months,” the report concluded.
“Council officials have been clear about the need for a fair and sustainable financial structure that reflects and responds to the actual extent of disadvantage and need,” stated a council leader.
“Lacking this, councils will persist to face difficult decisions around which essential services to allocate spend to, and which to reduce, to the detriment of their communities.”
A fifth of local authorities have reduced or weakened care services in the last year, the study revealed.
