According to a latest study of local authorities, English councils are planning to offload community centers, sports centres, and retail spaces as they bet on a rapid disposal of properties to balance the books.
Growing Financial Challenges Drive Asset Sales
A coalition of councils representing major urban areas in England stated that six out of ten of local authorities are intending to dispose of properties to meet the rising costs of adult and children’s social care.
Councils have previously come under fire for selling playing fields and open spaces to shore up their finances, but they contend they must continue to generate essential revenue from asset sales or declare themselves bankrupt.
The group said that a high proportion of authorities seeking to generate funds from a quick sale of assets marked “a distinct shift from 2024, when the largest share (six in ten) of local leaders stated they would prioritise restructuring services and using savings to weather increasing fiscal pressures.”
Specific Examples of Proposed Disposals
One local authority in southeast England announced its property management strategy included the sale of a shopping centre in a local town and a social club in another town to raise 20 million pounds over five years.
- A local golf course and business parks owned in two English counties, which all generate rent for the authority, will additionally be sold under the strategy.
Local Levy Increases and Wider Fiscal Pressures
The survey of local authorities in the coalition, which includes several urban centers, also found that over seven in ten of authorities will have to raise council taxes next April to address the growing cost of essential services, higher levels of housing insecurity, and a longstanding housing shortage.
The authority explained it will proceed with asset sales after steep rises in the cost of youth support, special educational needs and disability (Send) provision, adult social care, and temporary accommodation.
“We are adopting creative strategies but certain measures take time to achieve both improved services and financial savings,” stated a council leader.
He added: “There are population challenges which will persist to increase the pressures we have. As a local government body, we had a 91% cut in our central funding from 2010-24, which is very challenging.”
Countrywide Patterns and Forecasts
A survey of county councils this week also found local finances being stretched by the increasing figures of children and older individuals needing special educational assistance.
A network of councils projected that local shortfalls will hit 4.4 billion pounds a year by the end of the decade, as they grapple to manage rising needs.
Government officials 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 Gaps
Based on the latest deprivation measures (the Index of Multiple Deprivation) for English councils, several key cities members were included in the most disadvantaged in England.
- “Member cities like Hull, Bradford, Stoke-on-Trent, Sunderland and Wolverhampton place in the most deprived 30 across the country under the latest IMD measures,” said the study.
“Although only a single urban area is in the top 10 for disadvantaged communities nationally, cities are far more likely to be in the most deprived fifth of the nation. The data underscores the scale of difficulties facing local leaders across major urban centers in the coming year,” the analysis added.
“Local government leaders have been explicit about the need for a equitable and lasting financial structure that reflects and responds to the actual extent of deprivation and demand,” said Michael Mordey.
“Lacking this, local authorities will continue to face difficult decisions around which essential services to allocate spend to, and which to cut, to the disadvantage of their communities.”
One in five of councils have reduced or weakened care services in the last year, the study found.
