According to a new study of municipal councils, UK councils are preparing to sell social clubs, athletic facilities, and shopping arcades as they rely on a fire sale of properties to stabilize finances.
Growing Fiscal Challenges Drive Asset Sales
A coalition of councils for second-tier cities in England stated that six out of ten of councils are planning to sell assets to cover the rising costs of adult and children’s social care.
Local governments have in the past come under fire for selling playing fields and open spaces to support their budgets, but they argue they must proceed to generate essential revenue from property disposals or face insolvency.
The group noted that a significant number of authorities seeking to raise money from a fire sale of holdings represented “a distinct shift from 2024, when the majority (60%) of municipal officials stated they would prioritise service redesigns and utilising savings to weather increasing financial challenges.”
Detailed Examples of Proposed Disposals
Medway Council in southeast England said its property management strategy featured the disposal of a retail complex in a local town and a community venue in Rochester to generate £20m over the next half-decade.
- Gillingham golf club and business parks owned in Worcestershire and Suffolk, which all generate rent for the authority, will additionally be disposed of under the plan.
Local Levy Increases and Wider Financial Pressures
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 increase council taxes next spring to address the growing cost of essential services, increased rates of housing insecurity, and a longstanding accommodation deficit.
The authority said it will press ahead with property disposals after sharp increases in the cost of children services, special educational needs and disability (Send) provision, adult social care, and temporary accommodation.
“We are taking creative strategies but certain measures require time to achieve both improved services and cost efficiency,” said a council leader.
He continued: “There are population challenges 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.”
National Trends and Projections
Research of county councils this week further found council budgets being stretched by the increasing figures of children and adults requiring special educational assistance.
A network of councils said that council deficits will hit 4.4 billion pounds a year by the end of the decade, as they struggle to manage increased demand.
Government officials have put off planned reforms to the Send system until the coming year after a white paper outlining those changes was recently delayed.
Disadvantage and Financial Shortfalls
According to the most recent deprivation measures (IMD) covering UK local authorities, several key cities members were included in the most disadvantaged in the country.
- “Member cities like Hull, Bradford, Stoke-on-Trent, Sunderland and Wolverhampton rank in the most deprived 30 nationally under the 2025 IMD measures,” said the report.
“While only one key city is among the ten most deprived for deprived neighbourhoods countrywide, cities are far more likely to be in the worst-off 20% of England. The figures highlights the extent of challenges confronting municipal officials across key cities in the coming year,” the report concluded.
“Local government leaders have been clear about the need for a equitable and lasting funding system that reflects and responds to the actual extent of disadvantage and need,” stated Michael Mordey.
“Lacking this, councils will continue to face impossible choices around which essential services to fund, and which to cut, to the detriment of their residents.”
A fifth of councils have cut or compromised social care provision in the past 12 months, the study revealed.
