Title

ASSET MANAGEMENT

Selling the family silver is a mistake

The Government is Incentivising councils to sell off publicly-owned assets, 'but these flexibilities should not become business as usual and they are not a sufficient substitute for a reform of our broken funding system', warns Rob Whiteman.

Grounded in a reluctance to provide direct funding, the Government is incentivising councils to dispose of publicly-owned buildings and assets.

But selling the family silver to fund ongoing revenue costs is a terrible way to fix financial distress.

While we welcome greater flexibility handed to councils, the directive to break the rules of accounting convention marks an appalling shift from stable funding.

At best, disposing of assets to fund revenue shortfalls defers the impact of cost pressures on the general fund. In some cases these flexibilities risk exacerbating costs regardless.

This is unsustainable because it generates one-off cash injections that come with the burden of liability and borrowing costs, not to mention the loss of a potentially productive asset for the local authority.

In this way, there is a risk local authorities are drawn into fire sales in efforts to plug budget shortfalls. This could drive poor value for money for communities.

The Chartered Institute of Public Finance and Accountancy (CIPFA) recommends flexibilities are limited to invest-to-save and uptake closely monitored. Independent reviews handled by a stakeholder panel including CIPFA and the Local Government Association could be an option.

Raising money in this way does not address longer-term pressures on finances and fails to target the underlying issue of how services are funded. The funding gap of £4bn, estimated over the next two years, can hardly be topped up by flexibilities on capital funding alone.

These flexibilities should not become business as usual and they are not a sufficient substitute for a reform of our broken funding system. The Government must set out what longer-term support will be provided. Only through such strategic and lasting measures can we safeguard the stability of our local government financing.

Rob Whiteman CBE is chief executive of CIPFA

X – @RobWhiteman

ASSET MANAGEMENT

MPs scold Home Office over lack of council involvement in asylum

By Dan Peters | 05 June 2026

Local authorities still lack a ‘meaningful say’ in asylum accommodation decisions, a cross-party committee of MPs has warned.

ASSET MANAGEMENT

Community resilience, civil defence and the leadership challenge for councils

By Stephen Moir | 05 June 2026

Civil resilience cannot be left solely to emergency planners, says Stephen Moir. Local government leaders should consider how communities, services and partn...

ASSET MANAGEMENT

Unai Emery's brilliance provides a great blueprint for local government finance leaders

By Rob Powell | 05 June 2026

Rob Powell says local government finance leaders have much to learn from Aston Villa's manager Unai Emery as they kick off the next budget and Medium-Term Fi...

ASSET MANAGEMENT

Government's fiscal devolution roadmap sparks fears over Treasury control

By By Martin Ford | 04 June 2026

Experts have sounded a warning over government plans to detail a ‘roadmap’ for fiscal devolution.

Popular articles by Rob Whiteman CBE