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According to a new study of municipal councils, English 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 Prompt Asset Sales

The Key Cities Group for second-tier cities in England stated that six out of ten of councils are intending to sell assets to meet the escalating costs of adult and children’s social care.

Local governments have in the past come under fire for selling public land and open spaces to shore up their finances, but they argue they must continue to raise vital cash from asset sales or face insolvency.

The group noted that a high proportion of authorities attempting to generate funds from a quick sale of assets represented “a clear change from 2024, when the largest share (60%) of municipal officials stated they would focus on restructuring services and utilising financial reserves to weather increasing financial challenges.”

Specific Examples of Proposed Disposals

Medway Council in Kent announced its property management strategy included the sale of a shopping centre in a local town and a social club in Rochester 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 strategy.

Local Levy Rises and Broader Fiscal Pressures

The survey of councils in the key cities group, which includes Sunderland, Southampton, Gloucester and Salford, further found that over seven in ten of councils will have to raise council taxes next April to address the rising cost of essential services, increased rates of homelessness, and a persistent housing shortage.

Medway council explained it will press ahead with asset sales after steep rises in the cost of children services, support for vulnerable learners, adult social care, and short-term housing.

“We are taking innovative approaches but some of these take time to deliver both improved services and financial savings,” stated Vince Maple.

He added: “There are population challenges which will continue to increase the strains we have. As a local government body, we had a drastic reduction in our central funding from over the past decade, which is extremely difficult.”

National Patterns and Forecasts

Research of regional authorities this week further found council budgets being stretched by the increasing figures of young people and adults needing special educational assistance.

The County Councils Network said that council deficits will reach 4.4 billion pounds a year by 2029, as they struggle to manage increased demand.

Ministers have delayed scheduled changes to the special educational needs framework until next year after a policy document setting out those changes has been postponed.

Disadvantage and Funding Gaps

According to the latest indices of deprivation (the Index of Multiple Deprivation) covering English councils, several key cities members were among the most deprived in the country.

• “Member cities like several major towns rank in the most deprived 30 nationally under the latest deprivation indices,” said the report.

“Although only one key city is among the ten most deprived for disadvantaged communities countrywide, cities are much more prone to be in the most deprived fifth of the nation. The data highlights the scale of difficulties confronting local leaders across key cities in the coming year,” the report concluded.

“Council officials have been clear about the need for a fair and sustainable financial structure that reflects and responds to the actual extent of deprivation and need,” stated Michael Mordey.

“Without this, councils will continue to face impossible choices around which vital provisions to allocate spend to, and which to cut, to the detriment of their communities.”

One in five of local authorities have reduced or weakened social care provision in the past 12 months, the study found.