According to a new survey of local authorities, English councils are preparing to sell community centers, athletic facilities, and retail spaces as they rely on a rapid disposal of properties to balance the books.
The Key Cities Group for major urban areas in England reported that 60% of councils are intending to sell assets to cover the escalating costs of adult and children’s social care.
Local governments have previously come under fire for disposing of public land and land to shore up their finances, but they contend they must proceed to generate essential revenue from asset sales or face insolvency.
This coalition noted that a high proportion of councils seeking to raise money from a fire sale of assets represented “a distinct shift from 2024, when the majority (six in ten) of local leaders said they would focus on service redesigns and utilising savings to weather growing fiscal pressures.”
One local authority in Kent announced its property management strategy included the sale of a shopping centre in Rainham and a social club in Rochester to raise £20m over five years.
This research of councils in the key cities group, which includes several urban centers, further found that over seven in ten of authorities will have to increase local levies next spring to address the growing cost of essential services, increased rates of homelessness, and a persistent housing shortage.
Medway council said it will proceed with property disposals after steep rises in the cost of children services, special educational needs and disability (Send) provision, elderly and disability services, and temporary accommodation.
“We are adopting innovative approaches but some of these require time to deliver both better provisions and cost efficiency,” stated a council leader.
He continued: “There are demographic pressures which will persist to add to the pressures we have. As a unitary authority, we had a drastic reduction in our central funding from over the past decade, which is very challenging.”
Research of county councils recently also found local finances being strained by the increasing figures of children and adults requiring Send support.
The County Councils Network 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 delayed scheduled changes to the Send system until the coming year after a white paper outlining those reforms was recently delayed.
Based on the most recent deprivation measures (the Index of Multiple Deprivation) covering English councils, many key cities members were included in the most disadvantaged in England.
“Although only one key city is in the ten most deprived for disadvantaged communities nationally, urban areas are far more likely to be in the most deprived fifth of England. The figures underscores the scale of challenges facing local leaders across major urban centers in the next twelve months,” the analysis concluded.
“Local government leaders have been explicit about the need for a fair and sustainable funding system that reflects and responds to the actual extent of deprivation and demand,” said a council leader.
“Without this, councils will persist to face difficult decisions around which essential services to allocate spend to, and which to cut, to the detriment of their communities.”
A fifth of councils have cut or compromised social care provision in the last year, the survey found.
