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According to a new study of local authorities, English councils are preparing to offload community centers, sports centres, and shopping arcades as they bet on a fire sale of assets to balance the books.

Growing Fiscal Challenges Prompt Asset Sales

The Key Cities Group for major urban areas in the UK stated that six out of ten of local authorities are intending to sell assets to cover the escalating costs of social services for vulnerable individuals.

Councils have in the past faced criticism for disposing of playing fields and land to support their finances, but they contend they must continue to generate essential revenue from property disposals or face insolvency.

This coalition said that a high proportion of councils attempting to generate funds from a quick sale of holdings marked “a distinct shift from 2024, when the majority (60%) of local leaders stated they would focus on restructuring services and utilising savings to weather growing financial challenges.”

Specific Examples of Proposed Disposals

One local authority in southeast England announced its asset disposal plan featured the disposal of a retail complex in Rainham and a community venue in another town to generate 20 million pounds over five years.

• Gillingham golf club and business parks owned in two English counties, which all provide rental income for Medway council, will additionally be disposed of under the strategy.

Local Levy Rises and Broader Financial Strains

This research of councils in the key cities group, which covers several urban centers, also found that more than 70% of authorities will have to raise council taxes next spring to address the growing cost of core provisions, higher levels of housing insecurity, and a longstanding housing shortage.

Medway council said it will press ahead with property disposals after sharp increases in the cost of children services, support for vulnerable learners, adult social care, and temporary accommodation.

“We are adopting creative strategies but certain measures take time to deliver both improved services and cost efficiency,” said a council leader.

He continued: “We face demographic pressures which will continue to add to the strains we have. As a unitary authority, we had a drastic reduction in our revenue support grant from 2010-24, which is extremely difficult.”

National Trends and Projections

Research of county councils recently also found local finances being stretched by the growing number of children and adults requiring Send support.

A network of councils said that council deficits will hit 4.4 billion pounds a year by the end of the decade, as they struggle to manage rising needs.

Ministers have put off scheduled changes to the Send system until next year after a white paper setting out those reforms has been postponed.

Deprivation and Financial Shortfalls

According to the most recent indices of deprivation (the Index of Multiple Deprivation) covering UK local authorities, many participating urban areas were included in the most deprived in England.

• “Participating urban centers like several major towns rank in the top 30 nationally under the latest deprivation indices,” said the report.

“While only a single urban area is among the top 10 for deprived neighbourhoods nationally, urban areas are much more prone to be in the worst-off 20% of the nation. The figures underscores the extent of difficulties facing local leaders across major urban centers in the next twelve months,” the report concluded.

“Local government leaders have been clear about the necessity for a equitable and lasting financial structure that reflects and addresses the actual extent of disadvantage and need,” said Michael Mordey.

“Lacking this, local authorities will persist to face difficult decisions around which vital provisions to fund, and which to reduce, to the disadvantage of their residents.”

One in five of councils have reduced or weakened care services in the last year, the study found.