According to a new study of municipal councils, UK councils are preparing to sell social clubs, athletic facilities, and retail spaces as they rely on a fire sale of assets to stabilize finances.
Increasing Fiscal Pressures Drive Asset Sales
The Key Cities Group representing major urban areas in England reported that six out of ten of councils are planning to dispose of properties to meet the escalating costs of adult and children’s social care.
Councils have in the past faced criticism for disposing of playing fields and open spaces to support their budgets, but they argue they must proceed to raise vital cash from asset sales or face insolvency.
The group said that a high proportion of authorities attempting to generate funds from a fire sale of assets marked “a clear change from 2024, when the largest share (six in ten) of local leaders stated they would focus on service redesigns and utilising savings to weather increasing financial challenges.”
Specific Cases of Proposed Disposals
Medway Council in Kent said its asset disposal plan included the disposal of a shopping centre in a local town and a social club in another town to generate £20m over five years.
- A local golf course and business parks held in two English counties, which all generate rent for the authority, will also be disposed of under the strategy.
Local Levy Rises and Broader Financial Strains
This research of local authorities in the key cities group, which includes Sunderland, Southampton, Gloucester and Salford, also found that more than 70% of councils will have to increase local levies next April to address the growing cost of core provisions, increased rates of homelessness, and a longstanding housing shortage.
The authority explained it will press ahead with property disposals after steep rises in the cost of youth support, support for vulnerable learners, adult social care, and temporary accommodation.
“We are adopting creative strategies but certain measures require time to achieve both improved services and cost efficiency,” said a council leader.
He added: “We face demographic pressures which will continue to increase the strains 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 Projections
Research of regional authorities this week also found council budgets being stretched by the growing number of young people and adults needing special educational assistance.
A network of councils projected that local shortfalls will hit £4.4bn a year by 2029, as they struggle to manage increased demand.
Government officials have delayed scheduled changes to the special educational needs framework until next year after a policy document setting out those reforms was recently delayed.
Disadvantage and Financial Shortfalls
Based on the most recent indices of deprivation (the Index of Multiple Deprivation) covering English councils, many key cities members were included in the most disadvantaged in England.
- “Participating urban centers like several major towns place in the most deprived 30 across the country under the 2025 deprivation indices,” said the study.
“Although only a single urban area is in the top 10 for disadvantaged communities countrywide, cities are much more prone to be in the most deprived fifth of the nation. The data highlights the extent of challenges facing municipal officials across key cities in the coming year,” the analysis added.
“Council officials have been explicit about the necessity for a equitable and lasting financial structure that accounts for and responds to the real levels of disadvantage and demand,” said Michael Mordey.
“Lacking this, councils will persist to face difficult decisions around which vital provisions to fund, and which to reduce, to the detriment of their communities.”
One in five of councils have reduced or weakened social care provision in the last year, the study found.
