“The great British sell-off” – losing community assets to balance budgets

Since 2016, local authorities have been allowed to invest the proceeds of assets sold by April 2019 (now extended to 2021-22) into transforming frontline services, something they were previously prohibited from doing.  Following years of austerity and the extent of recent government funding cuts, it is not surprising that councils have used such money in this way.

However, the rate at which such assets are being sold has raised concerns over the potential loss of publicly-owned buildings and spaces.  Earlier this year, coinciding with the launch of their Save our Spaces campaign, Locality highlighted that on average more than 4,000 publicly owned buildings and spaces in England are being sold off every year – “more than four times the number of Starbucks in the UK.”

‘Financial predicament’

This year’s National Audit Office (NAO) report on the financial sustainability of councils highlights the financial predicament facing councils across the country. While it notes that the sector has done well to manage substantial funding cuts since 2010-11, financial pressure has increased markedly since 2014. In real terms, there has been a reduction in government funding of 49.1% since 2010, representing a reduction in local government spending power of 28.6%.

These cuts are coupled with rising demand for services and other cost pressures. For example, demand has increased for homelessness services and adult and children’s social care. The NAO highlights that from 2010-11 to 2016-17:

  • the number of households assessed as homeless and entitled to temporary accommodation under the statutory homeless duty increased by 33.9%;
  • the number of looked-after children grew by 10.9%; and
  • the estimated number of people in need of care aged 65 and over increased by 14.3%.

Other cost pressures have included higher national insurance contributions, the apprenticeship levy and the National Living Wage.

It is perhaps no shock that Northamptonshire county council became the first local authority since 1998 to be issued with a section 114 notice earlier this year, indicating it was unable to balance its books and at risk of being unable to set a legal budget for 2018/19. Nor is it indeed a shock that the NAO have identified other councils that are in danger of following suit in the next three years.

Despite this dire financial situation, it seems worse is to come. It has been recently announced that local services are to face a further £1.3bn cut in government funding in 2019/20. The revenue support grant, the main source of government funding for local services, will be cut by 36% next year – the largest annual deduction in almost a decade.

While the 2018 Budget has made provision for extra funding for adult social care, recent analysis suggests this falls short of what is needed to plug the projected funding gap.

Plugging the gap

In a desperate bid to raise finances, councils have been trying to find alternative income streams. A growing reliance on the use of reserves to offset funding reductions is an approach highlighted as unsustainable by the NAO. Most councils plan to increase or introduce charges for various services and many have also been making use of the government’s flexibility offer of using capital receipts to make improvements to services.

According to the NAO, in the year to April 2017, £118.5m of such capital receipts were used in this way. Locality has reported that the rate of asset sales has been consistently high for the last five years, with an average of 4,131 publicly owned buildings and spaces being sold off each year. Many councils are hoping to sell off their historic town halls to save much needed money. But it’s not just buildings that are under threat; council-owned parks and other land are also at risk. A recent parks survey, published by the Association for Public Service Excellence (APSE), found that 85% of councils surveyed expect a cut in parks and green space funding in the next year. In January, Knowsley council voted to go ahead with proposals to sell 10% of its parkland to fund the running of its remaining parks, since funding for its green spaces is to end in March 2019.

Locality warns that selling such assets on the open market could result in them being lost to the community forever as they have no real influence over what they will be used for; and could potentially lead to social, economic and environmental decline.

Indeed, concerns have been raised over the programme of disposing of council assets by Norfolk County Council, which has recently been reported to be looking to save £10m by selling its assets.

Locality suggests that community ownership is the answer to saving such assets under threat. Community Asset Transfer, set up in 2003, enables councils to sell assets to community organisations at below market rates in return for demonstrable community benefit.

In a bid to increase affordable housing supply, for example, Leicester City Council has sold council land worth more than £5m for less than £10 as part of deals with housing associations. However, the Locality report shows that less than half of councils have a Community Asset Transfer policy. It also notes that while community ownership is a ‘powerful alternative’ to losing public buildings and spaces, it is not straight forward, and community organisations face a number of barriers, including:

  • funding;
  • lack of expertise;
  • limited time; and
  • a lack of clear process.

With 95% of councils surveyed expecting the sell-off of publicly owned buildings and spaces to play an increasingly important role in the next five years, it is surely paramount that something is done to protect important community assets from being lost.

Way forward

Locality has called for the government to create a Community Ownership Fund and for a change in legislation to make it easier for community organisations to gain control of such assets.

Or perhaps councils could follow the example of others who, instead of selling their assets, are using them to generate revenue. Lewisham Council for example, is planning to raise £500k through hosting large commercial events in its parks.

Whatever route local authorities take, it remains to be seen if others will follow in the  footsteps of Northamptonshire or succeed in counteracting continuing cuts to maintain services and balance budgets; and indeed protect important community assets.


If you enjoyed reading this you may also like our previous blogs on the civic use of heritage assets and the value of green spaces.

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SURF conference 2017 – What Scotland has learned from 25 years of regeneration

Mural of a taxi being elevated by ballons, Glasgow

Fantastical floating taxi mural, part of Glasgow’s City Centre Mural Trail

By Steven McGinty

If regeneration has been so successful, why are there still so many pilots?

This was just one of the many thought-provoking points raised at the Scottish Urban Regeneration Forum’s (SURF) 25th Anniversary Conference, where the very activity of regeneration was put under the microscope.

In a packed room of delegates, the day opened with two opposing views.

  • The first argued that although regeneration had undoubtedly had its failures, there had been a number of important successes, which had resulted in better places and opportunities for both communities and individuals.
  • The second – and more pessimistic perspective – was that regeneration policy had entirely failed, and that the areas experiencing poverty and deprivation had barely changed over the past 25 years (particularly in Glasgow, where much of the regeneration activity has been focused).

This provided a useful lens through which to view regeneration, as we moved onto a day of workshops and debates on 25 years of regeneration policy, starting from New Life for Urban Scotland all the way up to City Region Deals.

Below I’ve outlined some of the most interesting points to come from these sessions.

Universal income

There was broad agreement that regeneration was about more than building homes, and that one of its core purposes was to tackle inequality.

Universal Basic Income is a policy in which everyone in society is given a sum of money, without any conditions. This policy – likely to be popular – was proposed by a delegate, highlighting its potential for addressing increasing levels of income inequality. A pilot study is already underway in Finland, with participants reporting lower stress levels and greater incentive to work. The Scottish Government has also recently committed to funding local experiments in Fife, Glasgow and North Ayrshire Councils.

Communities need assets

In many of the debates, it was felt that community ownership of buildings and land was key to ensuring a fairer distribution of society’s wealth. Other benefits of community ownership include protecting key local services/facilities (which may have otherwise been lost) and offering better stewardship, as the community have a greater understanding of local needs.

Research has also shown that local communities – who have replaced private landlords – have outperformed the landlords they have replaced. In the past two decades, the value of their land has increased by almost 250%.

Distinctiveness of place

Delegates highlighted that local areas often need local solutions.  For instance, a representative from the Bute Island Alliance noted that addressing their declining population was key to their regeneration goals.

Community consultation

There was a strong feeling that communities had to be consulted. A representative from a local charity explained that “if you are working for a community, then it must include the community”. Others, suggested that some communities would not have the capacity to make decisions on regeneration projects. Yet, this was quickly deemed patronising, with many noting the series of failures by public officials.

Charrettes were seen as an ideal tool for consulting with communities. The Scottish Government define a charrette as:

an interactive design process, in which the public and stakeholders work directly with a specialised design team to generate a community vision, masterplan and action plan.”

The representative from the Bute Island Alliance highlighted that this process had been very helpful in the development of their regeneration plans.

Bringing communities together

It was widely acknowledged that communities are becoming more diverse, and that it’s important to include all members of society. One delegate recounted her experience of Social Inclusion Partnerships (SIPs) – an initiative which aimed to reduce social exclusion – explaining that this model was very successful at engaging with black and minority ethnic (BME) groups. We’ve also seen the Scottish Government recognise the need to encourage young people to get involved in local planning decisions.

Building an inclusive economy

Regeneration has always found it difficult to respond to wider political, economic, social and technological factors. Over decades, deindustrialisation and the change to a more knowledge-based economy has caused significant challenges for communities. For regeneration policy to be successful, it was suggested that people would need to be equipped with the skills to take part in future industries; otherwise we may see inequalities widen. Cities such as Dublin have seen rents increased dramatically due to the inward migration of highly-skilled technology workers, putting pressure on household budgets and showing the challenge for regeneration.

Final thoughts

In the past 25 years there has been an important shift in regeneration, moving from house building programmes to a more holistic approach, which includes policy areas such as health, employment, and the environment. However, the most recent Scottish Government regeneration strategy was published in 2011. It might therefore be time to revisit this strategy and provide a new vision for regeneration, taking recent learning and the changing environment into account. Maybe then, in the next 25 years, there will be no doubt over the successes of regeneration.


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