Based on a new study of municipal councils, UK councils are preparing to offload community centers, sports centres, and shopping arcades as they rely on a fire sale of assets to stabilize finances.
Increasing Fiscal Challenges Prompt Asset Sales
The Key Cities Group for second-tier cities in England stated that 60% of local authorities are planning to sell assets to meet the rising costs of adult and children’s social care.
Local governments have previously come under fire for selling public land and open spaces to support their budgets, but they argue they must continue to raise vital cash from property disposals or declare themselves bankrupt.
The group noted that a significant number of councils attempting to raise money from a fire sale of holdings represented “a distinct shift from 2024, when the largest share (60%) of local leaders stated they would focus on service redesigns and utilising financial reserves to weather increasing fiscal pressures.”
Specific Cases of Proposed Disposals
Medway Council in southeast England said its property management strategy featured the disposal of a shopping centre in Rainham and a community venue in Rochester to generate £20m over five years.
- 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 Financial Pressures
This research of councils in the key cities group, which includes Sunderland, Southampton, Gloucester and Salford, also found that more than 70% of authorities will have to raise local levies next April to address the growing cost of core provisions, higher levels of homelessness, and a persistent accommodation deficit.
The authority said it will proceed with asset sales after steep rises in the cost of youth support, support for vulnerable learners, elderly and disability services, and temporary accommodation.
“We are taking innovative approaches but certain measures take time to deliver both improved services and financial savings,” said a council leader.
He continued: “We face demographic pressures which will persist to increase the strains we have. As a unitary authority, we had a drastic reduction in our central funding from 2010-24, which is extremely difficult.”
Countrywide Patterns and Projections
A survey of regional authorities recently also found local finances being stretched by the growing number of young people and older individuals needing Send support.
The County Councils Network projected that council deficits will reach 4.4 billion pounds a year by the end of the decade, as they struggle to manage increased demand.
Ministers have delayed scheduled changes to the Send system until next year after a white paper setting out those changes has been postponed.
Deprivation and Financial Shortfalls
According to the latest deprivation measures (IMD) for UK local authorities, many participating urban areas were among the most disadvantaged in England.
- “Member cities like Hull, Bradford, Stoke-on-Trent, Sunderland and Wolverhampton rank in the top 30 across the country under the 2025 IMD measures,” said the study.
“While only one key city is among the ten most deprived for disadvantaged communities nationally, cities are much more prone to be in the worst-off 20% of the nation. The data highlights the extent of difficulties confronting local leaders across key cities in the coming year,” the analysis concluded.
“Council officials have been explicit about the need for a fair and sustainable financial structure that reflects and addresses the actual extent of disadvantage and demand,” stated Michael Mordey.
“Without this, local authorities will continue to face difficult decisions around which vital provisions to allocate spend to, and which to reduce, to the disadvantage of their residents.”
One in five of local authorities have cut or compromised social care provision in the last year, the survey found.
