According to a new study of municipal councils, UK councils are preparing to sell social clubs, sports centres, and retail spaces as they rely on a fire sale of assets to stabilize finances.
Growing Financial Challenges Drive Asset Sales
The Key Cities Group for major urban areas in the UK stated that 60% of councils are planning to sell assets to cover the rising costs of adult and children’s social care.
Councils have in the past come under fire for disposing of public land and land to support their finances, but they argue they must continue to raise vital cash from asset sales or face insolvency.
This coalition noted that a high proportion of councils attempting to raise money from a fire sale of assets represented “a clear change from 2024, when the majority (six in ten) of local leaders said they would prioritise restructuring services and utilising financial reserves to manage increasing financial challenges.”
Detailed Cases of Proposed Disposals
Medway Council in Kent announced its property management strategy included the sale of a shopping centre in a local town and a social club in another town to generate £20m over the next half-decade.
- A local golf course and business parks owned in Worcestershire and Suffolk, which all provide rental income for Medway council, will additionally be sold under the plan.
Local Levy Increases and Wider Financial Strains
This research of local authorities in the key cities group, which includes Sunderland, Southampton, Gloucester and Salford, further found that more than 70% of authorities will have to increase local levies next April to address the rising cost of essential services, higher levels of homelessness, and a persistent accommodation deficit.
Medway council said it will proceed with property disposals after sharp increases in the cost of children services, special educational needs and disability (Send) provision, elderly and disability services, and short-term housing.
“We are adopting innovative approaches but some of these take time to achieve both improved services and cost efficiency,” said a council leader.
He added: “There are population challenges which will continue to add to the pressures we have. As a local government body, we had a drastic reduction in our central funding from 2010-24, which is extremely difficult.”
Countrywide Trends and Forecasts
Research of county councils this week also found local finances being strained by the growing number of young people and older individuals needing Send support.
The County Councils Network said that local shortfalls will hit 4.4 billion pounds a year by the end of the decade, as they grapple to cope with rising needs.
Ministers have delayed scheduled changes to the Send system until the coming year after a white paper outlining those changes was recently delayed.
Disadvantage and Financial Shortfalls
According to the latest deprivation measures (IMD) covering English councils, several participating urban areas were among the most deprived in the country.
- “Participating urban centers like several major towns rank in the top 30 nationally under the 2025 deprivation indices,” noted the report.
“Although only one key city is in the ten most deprived for disadvantaged communities countrywide, cities are far more likely to be in the worst-off 20% of England. The figures highlights the extent of difficulties confronting local leaders across major urban centers in the next twelve months,” the report added.
“Local government leaders have been clear about the necessity for a equitable and lasting financial structure that reflects and addresses the actual extent of deprivation and demand,” said Michael Mordey.
“Lacking this, councils will persist to face difficult decisions around which essential services to allocate spend to, and which to cut, to the disadvantage of their residents.”
A fifth of councils have reduced or weakened social care provision in the last year, the survey found.
