According to a latest poll of municipal councils, English councils are preparing to sell community centers, sports centres, and retail spaces as they bet on a rapid disposal of assets to stabilize finances.
Growing Fiscal Challenges Prompt Asset Sales
The Key Cities Group representing second-tier cities in England stated that 60% of councils are planning to dispose of properties to meet the rising costs of adult and children’s social care.
Local governments have in the past faced criticism for selling playing fields and open spaces to shore up their finances, but they argue they must proceed to raise vital cash from asset sales or declare themselves bankrupt.
The group said that a significant number of councils seeking to generate funds from a quick sale of assets marked “a distinct shift from 2024, when the largest share (60%) of municipal officials stated they would prioritise service redesigns and using savings to manage increasing fiscal pressures.”
Detailed Examples of Proposed Disposals
One local authority in Kent said its asset disposal plan featured the disposal of a shopping centre in Rainham and a community venue in Rochester to generate £20m over the next half-decade.
- Gillingham golf club and commercial properties held in two English counties, which all generate rent for Medway council, will additionally be sold under the plan.
Local Levy Rises and Wider Fiscal Pressures
This research of local authorities in the key cities group, which covers Sunderland, Southampton, Gloucester and Salford, also found that over seven in ten of authorities will need to raise local levies next April to cover the growing cost of core provisions, increased rates of housing insecurity, and a longstanding housing shortage.
The authority said it will press ahead with asset sales after steep rises in the cost of children services, support for vulnerable learners, elderly and disability services, and short-term housing.
“We are taking innovative approaches but some of these require time to deliver both improved services and financial savings,” stated Vince Maple.
He continued: “There are population challenges which will persist to add to the strains we have. As a local government body, we had a drastic reduction in our revenue support grant from over the past decade, which is extremely difficult.”
Countrywide Trends and Projections
A survey of regional authorities this week also found local finances being stretched by the growing number of young people and older individuals requiring Send support.
A network of councils projected that local shortfalls will reach 4.4 billion pounds a year by 2029, as they grapple to manage increased demand.
Government officials have delayed planned reforms to the special educational needs framework until the coming year after a policy document setting out those changes was recently delayed.
Disadvantage and Financial Gaps
According to the most recent indices of deprivation (IMD) for English councils, many participating urban areas were included in the most deprived in the country.
- “Member cities like several major towns rank in the top 30 nationally under the latest IMD measures,” said the report.
“Although only a single urban area is among the top 10 for disadvantaged communities nationally, urban areas are much more prone to be in the most deprived fifth of England. The figures highlights the extent of difficulties confronting local leaders across key cities in the coming year,” the report added.
“Council officials have been explicit about the need for a equitable and lasting financial structure that accounts for and responds to the real levels of deprivation and demand,” stated a council leader.
“Lacking this, councils will continue to face impossible choices around which essential services to fund, and which to reduce, to the disadvantage of their residents.”
A fifth of councils have cut or compromised care services in the past 12 months, the study found.
