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According to a recent poll of municipal councils, UK councils are planning to offload community centers, athletic facilities, and retail spaces as they bet on a rapid disposal of assets to balance the books.

Growing Fiscal Challenges Drive Asset Sales

A coalition of councils representing second-tier cities in the UK stated that 60% of local authorities are intending to sell assets to cover the escalating costs of adult and children’s social care.

Councils have in the past come under fire for selling playing fields and land to support their finances, but they argue they must proceed to generate essential revenue from asset sales or face insolvency.

The group said that a significant number of councils seeking to generate funds from a quick sale of holdings represented “a distinct shift from 2024, when the majority (60%) of municipal officials stated they would prioritise restructuring services and using savings to manage growing financial challenges.”

Detailed Examples of Proposed Disposals

Medway Council in southeast England announced its property management strategy featured the sale of a shopping centre in a local town and a community venue in another town to raise £20m over five years.

• A local golf course and commercial properties held in Worcestershire and Suffolk, which all generate rent for the authority, will additionally be sold under the strategy.

Local Levy Rises and Broader Fiscal Strains

This research of local authorities in the coalition, which includes Sunderland, Southampton, Gloucester and Salford, also found that more than 70% of councils will need to raise local levies next April to cover the rising cost of essential services, higher levels of housing insecurity, and a longstanding housing shortage.

Medway council said it will press ahead with asset sales after steep rises 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 some of these take time to achieve both improved services and cost efficiency,” stated Vince Maple.

He added: “We face demographic pressures which will continue to add to the strains we have. As a local government body, 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 county councils this week further found council budgets being strained by the increasing figures of children and older individuals needing special educational assistance.

The County Councils Network projected that local shortfalls 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 planned reforms to the Send system until next year after a policy document setting out those changes was recently delayed.

Disadvantage and Funding Gaps

Based on the latest indices of deprivation (IMD) for UK local authorities, many key cities members were included in the most deprived in England.

• “Participating urban centers like Hull, Bradford, Stoke-on-Trent, Sunderland and Wolverhampton rank in the top 30 across the country under the latest deprivation indices,” noted the study.

“While only one key city is in the ten most deprived for disadvantaged communities nationally, cities are far more likely to be in the worst-off 20% of England. The data highlights the extent of difficulties confronting municipal officials across key cities in the next twelve months,” the analysis concluded.

“Council officials have been clear about the need for a fair and sustainable financial structure that accounts for and responds to the real levels of deprivation and demand,” said a council leader.

“Without this, councils will continue to face difficult decisions around which essential services to allocate spend to, and which to reduce, to the disadvantage of their residents.”

One in five of local authorities have reduced or weakened social care provision in the last year, the survey revealed.