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According to a new study of local authorities, English councils are preparing to sell social clubs, sports centres, and retail spaces as they bet on a fire sale of assets to balance the books.

Growing Financial Pressures Drive Asset Sales

The Key Cities Group representing second-tier cities in the UK reported that 60% of local authorities are planning to sell assets to cover the escalating costs of social services for vulnerable individuals.

Councils have in the past come under fire for disposing of public land and open spaces to support their budgets, but they contend they must proceed to generate essential revenue from property disposals or declare themselves bankrupt.

The group noted that a significant number of councils attempting to raise money from a quick sale of assets represented “a distinct shift from 2024, when the majority (six in ten) of local leaders said they would focus on restructuring services and utilising financial reserves to weather increasing fiscal pressures.”

Specific Cases of Planned Disposals

One local authority in southeast England announced its asset disposal plan featured the disposal of a retail complex in a local town and a community venue in Rochester to raise 20 million pounds over the next half-decade.

• Gillingham golf club and business parks owned in Worcestershire and Suffolk, which all provide rental income for the authority, will also be sold under the strategy.

Local Levy Rises and Wider Fiscal Pressures

The survey of councils in the coalition, which includes several urban centers, further found that more than 70% of councils will need to raise local levies next spring to address the rising cost of essential services, increased rates of housing insecurity, and a persistent housing shortage.

Medway council said it will press ahead with asset sales after steep rises in the cost of youth support, special educational needs and disability (Send) provision, elderly and disability services, and short-term housing.

“We are taking innovative approaches but certain measures require time to deliver both better provisions and financial savings,” stated a council leader.

He continued: “We face population challenges which will continue to add to the strains we have. As a local government body, we had a 91% cut in our revenue support grant from 2010-24, which is extremely difficult.”

National Patterns and Projections

Research of county councils this week also found local finances being stretched by the growing number of young people and adults needing special educational assistance.

The County Councils Network projected that local shortfalls will reach 4.4 billion pounds a year by 2029, as they grapple to cope with rising needs.

Government officials have delayed planned reforms to the special educational needs framework until the coming year after a white paper outlining those changes was recently delayed.

Disadvantage and Financial Gaps

According to the most recent deprivation measures (IMD) covering English councils, several key cities members were among the most deprived in England.

• “Participating urban centers like several major towns place in the top 30 across the country under the latest deprivation indices,” noted the study.

“While only one key city is among the top 10 for deprived neighbourhoods nationally, urban areas are much more prone to be in the worst-off 20% of England. The figures underscores the extent of difficulties confronting local leaders across major urban centers in the coming year,” the analysis added.

“Council officials have been clear about the necessity for a equitable and lasting financial structure that reflects and addresses the actual extent of disadvantage and demand,” said Michael Mordey.

“Lacking this, local authorities will continue to face difficult decisions around which essential services to fund, and which to cut, to the detriment of their residents.”

One in five of local authorities have reduced or weakened care services in the last year, the study found.