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According to a latest study of local authorities, English councils are planning to sell social clubs, athletic facilities, and shopping arcades as they rely on a fire sale of properties to balance the books.

Increasing Financial Challenges Prompt Asset Sales

A coalition of councils for second-tier cities in England reported that 60% of councils are planning to dispose of properties to cover the rising costs of adult and children’s social care.

Councils have in the past faced criticism for selling public land and land to shore up their budgets, but they contend they must proceed to generate essential revenue from property disposals or declare themselves bankrupt.

The group noted that a high proportion of authorities seeking to raise money from a quick sale of holdings represented “a clear change from 2024, when the largest share (six in ten) of local leaders stated they would prioritise restructuring services and using financial reserves to weather growing fiscal pressures.”

Detailed Examples of Proposed Sales

Medway Council in Kent said its asset disposal plan included the sale of a retail complex in Rainham and a community venue in another town to generate £20m over five years.

• A local golf course and commercial properties held in Worcestershire and Suffolk, which all generate rent for Medway council, will also be sold under the plan.

Council Tax Increases and Wider Fiscal Pressures

The survey of local authorities in the coalition, which includes several urban centers, further found that more than 70% of councils will need to increase local levies next April to cover the rising cost of essential services, increased rates of homelessness, and a longstanding housing shortage.

Medway council explained it will press ahead with property disposals after sharp increases in the cost of youth support, support for vulnerable learners, elderly and disability services, and short-term housing.

“We are taking creative strategies but certain measures require time to deliver both improved services and financial savings,” said Vince Maple.

He continued: “We face demographic pressures which will persist to add to the strains we have. As a unitary authority, we had a 91% cut in our revenue support grant from over the past decade, which is extremely difficult.”

Countrywide Trends and Projections

Research of county councils recently also found local finances being strained by the increasing figures of children and older individuals requiring special educational assistance.

A network of councils projected that local shortfalls will hit £4.4bn a year by the end of the decade, as they struggle to manage increased demand.

Government officials have put off scheduled changes to the Send system until next year after a policy document setting out those reforms was recently delayed.

Deprivation and Funding Shortfalls

According to the latest deprivation measures (IMD) for English councils, several participating urban areas were among the most disadvantaged in England.

• “Participating urban centers like several major towns place in the most deprived 30 across the country under the latest deprivation indices,” said the report.

“While only one key city is among the ten most deprived for deprived neighbourhoods nationally, urban areas are much more prone to be in the most deprived fifth of the nation. The data highlights the extent of difficulties confronting local leaders across key cities in the next twelve months,” the report added.

“Local government leaders have been explicit about the need for a equitable and lasting financial structure that accounts for and responds to the actual extent of disadvantage and need,” said Michael Mordey.

“Without this, local authorities will persist to face difficult decisions around which essential services to fund, and which to cut, to the detriment of their residents.”

One in five of councils have cut or compromised social care provision in the past 12 months, the survey revealed.