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According to a new study of local authorities, English councils are preparing to offload social clubs, sports centres, and retail spaces as they rely on a fire sale of assets to stabilize finances.

Growing Financial Pressures Prompt Asset Sales

A coalition of councils for major urban areas in England stated that six out of ten of councils are planning to dispose of properties to meet the escalating costs of adult and children’s social care.

Councils have in the past come under fire for disposing of playing fields and land to support their finances, but they contend they must proceed to generate essential revenue from asset sales or declare themselves bankrupt.

The group noted that a significant number of authorities attempting to raise money from a fire sale of assets represented “a clear change from 2024, when the majority (60%) of local leaders said they would prioritise service redesigns and using savings to weather increasing fiscal pressures.”

Detailed Examples of Proposed Sales

One local authority in southeast England said its asset disposal plan featured the sale of a shopping centre in a local town and a community venue in another town to generate £20m over five years.

• Gillingham golf club and business parks owned in Worcestershire and Suffolk, which all generate rent for Medway council, will additionally be disposed of under the plan.

Council Tax Increases and Wider Fiscal Strains

This research of councils in the coalition, which covers Sunderland, Southampton, Gloucester and Salford, further found that more than 70% of councils will have to raise council taxes next spring to address the growing cost of core provisions, increased rates of housing insecurity, and a longstanding accommodation deficit.

The authority said it will proceed with asset sales 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 deliver both better provisions and cost efficiency,” said Vince Maple.

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 very challenging.”

National Trends and Forecasts

Research of regional authorities this week also found local finances being stretched by the increasing figures of children and older individuals needing Send support.

A network of councils said that council deficits will hit £4.4bn a year by the end of the decade, as they struggle to cope with increased demand.

Ministers have put off planned reforms to the special educational needs framework until next year after a white paper setting out those reforms has been postponed.

Deprivation and Funding Shortfalls

Based on the most recent deprivation measures (IMD) for English councils, several key cities members were among the most disadvantaged in the country.

• “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, urban areas are far more likely to be in the worst-off 20% of the nation. The figures underscores the scale of difficulties confronting municipal officials across key cities in the next twelve months,” the analysis concluded.

“Council officials have been explicit about the necessity for a equitable and lasting funding system that accounts for and responds to the actual extent of disadvantage and need,” said Michael Mordey.

“Lacking 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 communities.”

One in five of councils have reduced or weakened care services in the past 12 months, the survey revealed.