Based on a new poll of municipal councils, UK councils are preparing to offload community centers, sports centres, and retail spaces as they rely on a fire sale of assets to stabilize finances.
Growing Fiscal Challenges Prompt Asset Sales
A coalition of councils representing second-tier cities in England stated that six out of ten of councils are intending to sell assets to cover the escalating costs of adult and children’s social care.
Local governments have in the past come under fire for selling playing fields and land to shore up their budgets, but they argue they must continue to raise vital cash from property disposals or face insolvency.
This coalition noted that a high proportion of councils seeking to raise money from a fire sale of assets represented “a clear change from 2024, when the majority (60%) of municipal officials said they would focus on restructuring services and utilising financial reserves to weather growing fiscal pressures.”
Detailed Examples of Proposed Sales
Medway Council in Kent said its asset disposal plan included the disposal of a retail complex in Rainham and a community venue in another town to generate £20m over five years.
- Gillingham golf club and commercial properties owned in two English counties, which all provide rental income for the authority, will additionally be sold under the strategy.
Council Tax Rises and Broader Fiscal Pressures
The survey of councils in the coalition, which includes Sunderland, Southampton, Gloucester and Salford, further found that over seven in ten of authorities will need to raise council taxes next April to address the rising cost of essential services, increased rates of homelessness, and a longstanding accommodation deficit.
The authority explained it will proceed 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 adopting innovative approaches but certain measures require time to deliver both improved services and cost efficiency,” stated a council leader.
He added: “There are demographic pressures which will continue to increase the strains we have. As a local government body, we had a 91% cut in our central funding from over the past decade, which is extremely difficult.”
Countrywide Patterns and Forecasts
A survey of county councils this week also found council budgets being stretched by the growing number of young people and adults requiring special educational assistance.
A network of councils said that local shortfalls will reach £4.4bn a year by the end of the decade, as they struggle to cope with 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.
Deprivation and Funding Shortfalls
According to the most recent deprivation measures (IMD) for UK local authorities, several participating urban areas were among the most disadvantaged in England.
- “Participating urban centers like several major towns rank in the top 30 across the country under the 2025 deprivation indices,” said the report.
“Although only a single urban area is in the top 10 for disadvantaged communities countrywide, cities are far more likely to be in the worst-off 20% of the nation. The figures underscores the extent of difficulties confronting municipal officials across key cities in the coming year,” the analysis added.
“Local government leaders have been clear about the necessity for a fair and sustainable financial structure that accounts for and addresses the real levels of disadvantage and demand,” stated Michael Mordey.
“Without this, councils will persist to face impossible choices around which vital provisions to allocate spend to, and which to cut, to the detriment of their communities.”
One in five of councils have reduced or weakened care services in the past 12 months, the study revealed.
