Based on a new survey of municipal councils, UK councils are planning to sell social clubs, athletic facilities, and retail spaces as they rely on a rapid disposal of properties to stabilize finances.
Growing Financial Pressures Prompt Asset Sales
A coalition of councils representing second-tier cities in the UK stated that 60% of councils are planning to dispose of properties to cover the rising costs of social services for vulnerable individuals.
Local governments have previously come under fire for disposing of public land and land to support their finances, but they argue they must continue to generate essential revenue from property disposals or declare themselves bankrupt.
The group noted that a significant number of councils seeking to generate funds from a quick sale of assets marked “a distinct shift from 2024, when the majority (six in ten) of local leaders stated they would prioritise service redesigns and utilising financial reserves to manage increasing financial challenges.”
Specific Cases of Planned Sales
Medway Council in Kent announced its asset disposal plan featured the disposal of a retail complex in a local town and a social club in Rochester to raise £20m over five years.
- A local golf course and commercial properties owned in two English counties, which all generate rent for Medway council, will also be disposed of under the plan.
Council Tax Rises and Broader Fiscal Strains
This research of councils in the key cities group, which includes Sunderland, Southampton, Gloucester and Salford, further found that more than 70% of councils will need to raise council taxes next April to address the rising cost of core provisions, increased rates of homelessness, and a persistent accommodation deficit.
The authority explained it will press ahead with property disposals after sharp increases in the cost of youth support, special educational needs and disability (Send) provision, elderly and disability services, and short-term housing.
“We are taking innovative approaches but some of these take time to deliver both improved services and cost efficiency,” said Vince Maple.
He continued: “There are population challenges which will persist to increase the strains we have. As a unitary authority, we had a drastic reduction in our revenue support grant from 2010-24, which is very challenging.”
National Patterns and Projections
A survey of county councils recently also found council budgets being strained by the increasing figures of children and adults requiring Send support.
The County Councils Network projected that council deficits will hit 4.4 billion pounds a year by 2029, as they struggle to cope with rising needs.
Government officials have put off planned reforms to the Send system until the coming year after a policy document outlining those reforms was recently delayed.
Deprivation and Funding Shortfalls
Based on the latest deprivation measures (the Index of Multiple Deprivation) for English councils, several key cities members were included in the most disadvantaged in England.
- “Participating urban centers like several major towns rank in the top 30 across the country under the 2025 deprivation indices,” noted the report.
“Although only one key city is among the top 10 for disadvantaged communities countrywide, cities are much more prone to be in the most deprived fifth of the nation. The data underscores the extent of challenges confronting municipal officials across major urban centers in the coming year,” the report added.
“Local government leaders have been explicit about the necessity for a equitable and lasting funding system that reflects and addresses the real levels of deprivation and demand,” stated Michael Mordey.
“Without this, councils will continue to face impossible choices around which vital provisions to fund, and which to cut, to the disadvantage of their communities.”
One in five of councils have cut or compromised care services in the last year, the survey found.
