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Based on a new poll of local authorities, English councils are planning to sell community centers, athletic facilities, and retail spaces as they rely on a rapid disposal of assets to balance the books.

Increasing Fiscal Challenges Drive Asset Sales

The Key Cities Group representing second-tier cities in England stated that 60% of local authorities are intending to sell assets to meet the rising costs of adult and children’s social care.

Local governments have in the past faced criticism for selling playing fields and open spaces to shore up their budgets, but they argue they must proceed to generate essential revenue from asset sales 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 majority (six in ten) of municipal officials said they would focus on restructuring services and using savings to manage growing financial challenges.”

Specific Cases of Proposed Sales

One local authority in southeast England said its property management strategy featured the disposal of a retail complex in a local town and a community venue in another town to raise 20 million pounds over the next half-decade.

• A local golf course and business parks held in two English counties, which all generate rent for the authority, will additionally be sold under the strategy.

Council Tax Rises and Broader Fiscal Strains

The survey of local authorities in the coalition, which covers Sunderland, Southampton, Gloucester and Salford, also found that over seven in ten of authorities will need to raise council taxes next April to address the growing cost of essential services, increased rates of housing insecurity, and a longstanding accommodation deficit.

Medway council explained it will proceed with property disposals after steep rises in the cost of youth support, special educational needs and disability (Send) provision, elderly and disability services, and short-term housing.

“We are adopting innovative approaches but some of these require time to deliver both improved services and financial savings,” said Vince Maple.

He added: “There are demographic pressures which will persist to add to the strains we have. As a unitary authority, we had a drastic reduction in our revenue support grant from over the past decade, which is very challenging.”

National Trends and Forecasts

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

The County Councils Network projected that council deficits will hit 4.4 billion pounds a year by the end of the decade, as they struggle to cope with rising needs.

Ministers have put off scheduled changes to the Send system until next year after a white paper outlining those reforms was recently delayed.

Disadvantage and Funding Shortfalls

According to the latest deprivation measures (IMD) for English councils, many key cities members were included in the most disadvantaged in England.

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

“While only one key city is in the top 10 for deprived neighbourhoods countrywide, cities are far more likely to be in the worst-off 20% of the nation. The figures underscores the extent of challenges facing municipal officials across major urban centers in the next twelve months,” the analysis added.

“Local government leaders have been clear about the necessity for a fair and sustainable funding system that reflects and addresses the real levels of deprivation and demand,” said a council leader.

“Without this, councils will persist to face difficult decisions around which essential services to fund, and which to cut, to the disadvantage of their communities.”

A fifth of councils have cut or compromised social care provision in the last year, the survey found.