Based on a new study of municipal councils, UK councils are preparing to sell social clubs, sports centres, and shopping arcades as they bet on a fire sale of properties to stabilize finances.
Increasing Financial Pressures Drive Asset Sales
The Key Cities Group representing second-tier cities in the UK stated that six out of ten of councils are intending to sell assets to cover the rising costs of social services for vulnerable individuals.
Councils have previously faced criticism for selling public land and open spaces to support their finances, but they argue they must proceed to generate essential revenue from asset sales or face insolvency.
This coalition said that a high proportion of councils seeking to generate funds from a quick sale of holdings represented “a clear change from 2024, when the majority (60%) of local leaders said they would focus on service redesigns and utilising financial reserves to weather growing financial challenges.”
Detailed Examples of Proposed Disposals
One local authority in Kent said its asset disposal plan included the disposal of a shopping centre in Rainham and a community venue in another town to raise 20 million pounds over the next half-decade.
- Gillingham golf club and commercial properties held in two English counties, which all provide rental income for Medway council, will also be disposed of under the plan.
Local Levy Rises and Wider Fiscal Pressures
The survey of councils in the key cities group, which covers Sunderland, Southampton, Gloucester and Salford, further found that more than 70% of councils will have to raise council taxes next April to cover the growing cost of core provisions, increased rates of homelessness, and a longstanding accommodation deficit.
Medway council said it will press ahead with asset sales after sharp increases in the cost of youth support, support for vulnerable learners, adult social care, and short-term housing.
“We are adopting creative strategies but some of these take time to deliver both better provisions and cost efficiency,” said Vince Maple.
He continued: “We face population challenges which will continue to increase the strains we have. As a unitary authority, we had a 91% cut in our central funding from 2010-24, which is very challenging.”
National Trends and Forecasts
A survey of county councils recently further found local finances being stretched by the growing number of young people and older individuals requiring Send support.
The County Councils Network said that council deficits will reach £4.4bn a year by the end of the decade, as they grapple to manage rising needs.
Government officials have put off planned reforms to the special educational needs framework until the coming year after a white paper setting out those changes has been postponed.
Deprivation and Funding Gaps
Based on the most recent indices of deprivation (IMD) covering English councils, many participating urban areas were among the most disadvantaged in the country.
- “Participating urban centers like Hull, Bradford, Stoke-on-Trent, Sunderland and Wolverhampton rank in the top 30 nationally under the 2025 IMD measures,” said the study.
“While only a single urban area is among the ten most deprived for disadvantaged communities nationally, urban areas are much more prone to be in the most deprived fifth of the nation. The data underscores the extent of difficulties confronting municipal officials across key cities in the next twelve months,” the analysis concluded.
“Council officials have been explicit about the need for a equitable and lasting funding system that accounts for and addresses the real levels of disadvantage and need,” said Michael Mordey.
“Without this, local authorities will persist to face impossible choices around which essential services to fund, and which to reduce, to the detriment of their communities.”
A fifth of councils have reduced or weakened care services in the last year, the study found.
