According to a new study of municipal councils, UK councils are planning to sell community centers, athletic facilities, and shopping arcades as they rely on a fire sale of properties to balance the books.
Increasing Fiscal Challenges Prompt Asset Sales
The Key Cities Group for second-tier cities in England reported that six out of ten of local authorities are planning to dispose of properties to meet the rising costs of social services for vulnerable individuals.
Local governments have in the past faced criticism for disposing of public land and open spaces to support their finances, but they argue they must continue to raise vital cash from property disposals or face insolvency.
The group said that a significant number of councils seeking to generate funds from a fire sale of assets represented “a clear change from 2024, when the majority (60%) of local leaders stated they would focus on service redesigns and using financial reserves to manage increasing financial challenges.”
Detailed Examples of Planned Sales
Medway Council in Kent said its property management strategy included the sale of a shopping centre in a local town and a community venue in another town to raise £20m over the next half-decade.
- A local golf course and business parks held in Worcestershire and Suffolk, which all provide rental income for the authority, will additionally be disposed of under the plan.
Council Tax Increases and Broader Fiscal Pressures
This research of local authorities in the key cities group, which covers several urban centers, further found that over seven in ten of councils will have to increase local levies next April to address the rising cost of core provisions, higher levels of homelessness, and a persistent accommodation deficit.
Medway council said it will press ahead with property disposals after steep rises in the cost of children services, special educational needs and disability (Send) provision, adult social care, and temporary accommodation.
“We are taking innovative approaches but certain measures require time to achieve both better provisions and financial savings,” said a council leader.
He continued: “There are demographic pressures which will persist to increase the strains we have. As a unitary authority, we had a 91% cut in our revenue support grant from over the past decade, which is extremely difficult.”
National Patterns and Forecasts
Research of county councils recently further found council budgets being stretched by the growing number of young people and adults needing Send support.
The County Councils Network said that council deficits will reach £4.4bn a year by 2029, as they struggle to cope with increased demand.
Government officials have delayed planned reforms to the Send system until next year after a white paper setting out those reforms has been postponed.
Disadvantage and Financial Shortfalls
Based on the latest deprivation measures (IMD) covering UK local authorities, many key cities members were among the most disadvantaged in the country.
- “Member cities like Hull, Bradford, Stoke-on-Trent, Sunderland and Wolverhampton rank in the most deprived 30 across the country under the 2025 IMD measures,” said the study.
“While only a single urban area is in the top 10 for deprived neighbourhoods nationally, urban areas are far more likely to be in the most deprived fifth of the nation. The data highlights the extent of difficulties confronting municipal officials across key cities in the coming year,” the report added.
“Local government leaders have been clear about the need for a fair and sustainable financial structure that accounts for and addresses the real levels of deprivation and demand,” stated Michael Mordey.
“Without this, local authorities will continue to face impossible choices around which essential services to fund, and which to reduce, to the detriment of their residents.”
One in five of councils have reduced or weakened social care provision in the past 12 months, the study revealed.
