According to a new study of local authorities, English councils are planning to sell social clubs, sports centres, and shopping arcades as they rely on a fire sale of assets to balance the books.
The Key Cities Group for second-tier cities in the UK stated that six out of ten of local authorities are planning to sell assets 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 land to support their finances, but they argue they must continue to raise vital cash from property disposals or declare themselves bankrupt.
The group noted that a high proportion of authorities attempting to raise money from a fire sale of assets represented “a distinct shift from 2024, when the majority (six in ten) of local leaders said they would prioritise restructuring services and utilising financial reserves to weather increasing fiscal pressures.”
Medway Council in Kent said its property management strategy included the disposal of a shopping centre in a local town and a social club in another town to raise £20m over five years.
This research of councils in the key cities group, which covers Sunderland, Southampton, Gloucester and Salford, further found that over seven in ten of authorities will need to increase local levies next spring to address the rising cost of essential services, higher levels of housing insecurity, and a longstanding accommodation deficit.
Medway council explained it will proceed with property disposals after sharp increases in the cost of children services, special educational needs and disability (Send) provision, adult social care, and short-term housing.
“We are taking innovative approaches but certain measures require time to deliver both improved services and financial savings,” stated Vince Maple.
He added: “There are population challenges which will persist to add to the pressures 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.”
A survey of county councils this week also found local finances being strained by the growing number of young people and adults requiring special educational assistance.
The County Councils Network said that local shortfalls will hit £4.4bn a year by the end of the decade, as they grapple to cope with increased demand.
Ministers have delayed scheduled changes to the special educational needs framework until the coming year after a policy document setting out those reforms has been postponed.
Based on the most recent indices of deprivation (IMD) for UK local authorities, several key cities members were among the most deprived in the country.
“Although only a single urban area is among the ten most deprived for deprived neighbourhoods nationally, urban areas are far more likely to be in the most deprived fifth of England. The data highlights the extent of difficulties confronting local leaders across key cities in the coming year,” the report concluded.
“Local government leaders have been clear about the need for a equitable and lasting financial structure that accounts for and responds to the real levels of disadvantage and need,” said Michael Mordey.
“Lacking this, councils will continue to face impossible choices around which vital provisions to allocate spend to, and which to reduce, to the disadvantage of their communities.”
One in five of councils have reduced or weakened care services in the last year, the study revealed.
Maya Chen is a freelance writer and urban enthusiast with a passion for documenting city life and cultural shifts.
