Could councils be about to sell public assets to private interests?

Picture of fields and woodland obscured by a large sign saying 'Council Land for Sale'

5 March 2024

Chancellor Jeremy Hunt has said, ahead of today's wholly inadequate budget, that councils should cut back on 'wasteful spending'. 

But the truth is there is no more money to waste. Our councils have been desperately underfunded for years. Their local government grant has plummeted 40% in real terms between 2009-10 and 2019-20. Economists and financial analysts agree - our councils can't take it any more.

Now proposed rule changes introduced by Michael Gove, Secretary of State for Levelling Up, Housing and Communities of the United Kingdom, could see local councils selling off public assets, like parks, pools, libraries and refuse tips, to balance their books. A government consultation on the proposals closed at the end of January. And, after once again being blamed for declining services in today's budget speech, our councils are on tenterhooks waiting for the outcome. Here’s why.

At the moment, local government is allowed to buy or sell assets to fund new capital projects that meet local need - like buying land to build a new school. Michael Gove’s big idea is that councils could be allowed to get rid of their assets simply to help budget for day-to-day running costs; things like keeping the lights on, emptying the bins, or paying their staff, all of which you’d think we’re already paying for through council tax. 

Unsurprisingly this idea hasn’t gone down well with the Local Government Association (LGA), who responded by saying:

“Councils are best placed to know what works best for their community…capital receipts (and borrowing even more so) are not “free money” and they can only be spent once. They cannot be used to fund long term ongoing revenue pressures.”

In other words, as Samir Jeraj writes in The New Statesman, “Such a move might enable local authorities to plug the gaps in their budgets in the short term, but it would do nothing to tackle the underlying problem in council finances”.

One in five councils report they are on the brink of declaring bankruptcy. While individual councils have had specific problems (such as Birmingham’s £1bn bill to settle ten years of gender equality cases), the main reason so many are in such dire straits is that austerity has seen their funding streams cut by 40%. 

Here are five reasons why the Government must not open the door to more council sell-offs.

1: It takes wealth and power out of your hands. We know what happens when councils are starved of funds. Public assets get sold off or handed over to private companies, who don't have local community interests at their heart.

2: It hits your services. Using the current rules, Greenwich Council closed some of its libraries in order to sell the buildings in 2021. Birmingham’s emergency budget for 2024-25 includes shutting 25 of its 36 libraries. Overall, we've lost 800 libraries in the UK since 2010. 

3: It robs your community of its history. Northamptonshire Council flogged off some of its historical artefacts in 2014, but the short-term gain didn't stop it from going bankrupt just four years later.

4: It hits your culture. Herefordshire Council sold off its art collection in 2018. Birmingham is now planning to cut funding by 100% to all of its arts organisations by 2025. Under these rule changes, there's nothing to stop other councils doing the same.

5: It doesn't work. Despite selling property owned by the council in an attempt to stabilise its finances, Woking Council went into administration in the summer of 2013.

It’s no wonder the LGA responded to the proposal by saying “The ability to use capital resources to fund revenue costs must not be seen as a way out of the Government addressing other problems facing local government.”

The scale of the crisis facing our local councils is vast: they owe a combined £97.8bn to lenders, equivalent to around £1,400 per person. Some, like Birmingham City Council, have prepared emergency budgets involving massive cuts to public services in an effort to drag their finances out of the red. Others, like Bradford City Council, have already drawn up a list of buildings, land and other assets they may have to sell to stave off bankruptcy. That’s just under the current rules, with significant Government oversight. If the rules are further relaxed, the temptation to sell off valuable public assets including places of historic interest, just to buy themselves some breathing space, could be irresistible. 

And it would be the public who would ultimately pay the price. Councils will run out of cash-generating assets, find it harder to regenerate our communities, and experience weaker growth due to poorer public services. The death spiral of privatisation would take effect: public services defunded, cut back and less able to meet public need; public assets handed over to private capital; private capital seeking to maximise its assets and cut back even further. 

Michael Gove announced some extra funding for councils at the same time as discreetly launching this consultation. But the amount promised is nowhere near enough. 

The solution, as it always is when the spectre of private involvement in public services is raised, is to seek proper investment; in this case, we should be absolutely insisting that central government restores local government grants to their 2010 level in real terms. Otherwise, once these spaces and places are sold to private investors and developers, we won’t be getting them back.


Take action 

  • Use our petition tool to send a letter to Michael Gove demanding that he does not proceed with the proposed actions in the consultation.
  • Watch our video explaining what could happen if the proposals go ahead.



Picture of fields and woodland obscured by a large sign saying 'Council Land for Sale'

Do you believe in public services for people not profit?

Win campaigns for public ownership by subscribing to our mailing list! We'll hold your data in accordance with our privacy policy and send you carefully chosen information about current and future campaigns, projects and appeals. You can unsubscribe at any time.


Carol Horne replied on Permalink

A real term 40% reduction in government funding?! Over a mere 10years!! This is the starkest picture of this governments contempt for its people and it’s bowing down to the twisted values of rapacious self serving (of the wealthy). But what do we expect if we pander to this political party? The party of sociopaths; the party representing those of already unimaginable wealth; the party of grab and greed. In the words of the memorable Spooky Men’s Chorale song: “Vote the b******s out!”

Denise Galvan replied on Permalink


Chris Giles replied on Permalink

Michael Gove IS right. Local authorities do waste money…in bucket loads. Firstly they pay themselves top dollar….at least twice what our Prime Minister earns. The top executive structure is appalling. Because they are not elected, unelected and therefore unaccountable they literally jobs for life. They say pay well and you get exceptional people, not when they hid away in their ivory towers. Another example is the way they repair our pot holes, returning time and time again to repair the same patch. Need I go on?

Leonard Dykes replied on Permalink

God help society if the Conservatives get away with this ridiculous nonsense they need to support all councils with the funding they need to pay for all our services and amenities.

John Macdonald replied on Permalink

I suspect the position is even worse in Scotland after a decade of SNP posed Council Tax Freezes

Jenny Baker replied on Permalink

Swimming is a life skill. Every one should have the opportunity to swim. It keeps you fit. It enables you to build up strong muscles and muscles that will help to support your back as we get older and keeping the older generation fit and active for longer. We no longer have a pool in our area

Aileen O'Connor replied on Permalink

It is not right to sell off property and land etc that belongs to all of us. They sell off open spaces and the private builders build small houses with no land. No one seems to care about us the general public anymore. The 50s and 60's started building decent sized three bedroomed homes with gardens and parks etc Now we are losing everything. And it's high time the councils went back to running council houses. The government should never have started interfering in the running of the councils.

Patricia McAllister replied on Permalink

Short sighted madness

Charmian Porton replied on Permalink

We really must not sell off council owned assets. Who benefits by this privatisation. certainly not all the residents. We have seen what happens when council houses are sold, as it has deprived many low earners, the elderly and vulnerable somewhere permenant to live. And we have all seen the misery and heartbreak recently inflicted by the Post office by extremely well paid executives who do not seem to care. Every time I hear the word'privatisation' my heart sinks. There are too many 'fat cats' - who needs several houses, a fleet of expensive cars, and a yacht, when most of us just want a roof over our head, and enough to eat, and the occasional visit out - maybe to a museum or a walk in the park? I am 88 years old, and my mother always told us to be thankful for the little we had, and also to share that little bit.

Celia Foote replied on Permalink

City Councils support the services and infrastructure enabling businesses to operate and citzens with jobs, services and environment for them and their families. They then are able to pay taxes the majority of which goes to the Treasury. Taxes, which to a significant degree, are due to Local Government support and services this needs to be reflected in an increase of funds from central to local coffers. Not to do this is undemocratic, fiscally stupid and authoritarian.

Andrew Davies replied on Permalink

Councils do not own any assets to sell off. The assets belong to the community. They were bought with tax payers money whether that is local or national tax, it’s our money therefore whatever is bought with it is our property. The council are merely tasked with managing them on behalf of the community. They have no business selling them off.

Add new comment