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According to a new study of municipal councils, UK councils are preparing to sell community centers, athletic facilities, and shopping arcades as they rely on a fire sale of properties to balance the books.

Increasing Fiscal Pressures Drive Asset Sales

The Key Cities Group representing second-tier cities in the UK reported that 60% of local authorities are intending to dispose of properties to cover the rising costs of adult and children’s social care.

Local governments have previously faced criticism for disposing of public land and open spaces to shore up their finances, but they argue they must proceed to raise vital cash from asset sales or declare themselves bankrupt.

The group said that a significant number 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 municipal officials said they would focus on service redesigns and utilising financial reserves to manage increasing fiscal pressures.”

Specific Examples of Planned Disposals

One local authority in southeast England announced its property management strategy included the disposal of a retail complex in Rainham and a community venue in another town to generate 20 million pounds over five years.

• Gillingham golf club and business parks held in Worcestershire and Suffolk, which all generate rent for Medway council, will also be sold under the plan.

Local Levy Increases and Wider Financial Strains

The survey of councils in the key cities group, which includes several urban centers, further found that over seven in ten of authorities will need to increase council taxes next April to cover the growing cost of essential services, increased rates of housing insecurity, and a persistent accommodation deficit.

Medway council explained it will proceed with asset sales after sharp increases in the cost of youth support, support for vulnerable learners, elderly and disability services, and temporary accommodation.

“We are adopting innovative approaches but certain measures take time to deliver both better provisions and cost efficiency,” stated a council leader.

He continued: “We face population challenges which will persist to add to the pressures we have. As a local government body, we had a drastic reduction in our revenue support grant from 2010-24, which is very challenging.”

National Trends and Forecasts

A survey of county councils this week also found council budgets being stretched by the growing number of young people and older individuals requiring Send support.

A network of councils said that council deficits will reach £4.4bn a year by the end of the decade, as they grapple to cope with rising needs.

Government officials have delayed scheduled changes to the Send system until next year after a white paper setting out those changes was recently delayed.

Deprivation and Financial Gaps

According to the latest deprivation measures (IMD) for English councils, several participating urban areas were included in the most deprived in England.

• “Participating urban centers like several major towns rank in the top 30 across the country under the latest IMD measures,” said the report.

“Although only a single urban area is in the top 10 for deprived neighbourhoods nationally, cities are far more likely to be in the most deprived fifth of England. The figures highlights the scale of difficulties confronting local leaders across key cities in the next twelve months,” the analysis added.

“Local government leaders have been clear about the necessity for a equitable and lasting financial structure that accounts for and responds to the real levels of deprivation and need,” stated a council leader.

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

A fifth of local authorities have reduced or weakened care services in the past 12 months, the survey revealed.