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

Building a lasting legacy through reorganisation

By Manjeet Gill | 07 August 2026

Reflecting on her experience in Wiltshire, Manjeet Gill says strong leadership and trusted relationships transform council reorganisation into lasting organi...

ASSET MANAGEMENT

The workplace challenge: Preventing AI conflict before it starts

By Phil Floyd | 07 August 2026

As generative AI becomes a growing factor in employment disputes, Phil Floyd argues that the best way to prevent workplace conflicts is to foster a ‘clear ai...

ASSET MANAGEMENT

Creating a closer relationship

By Simon Kaye | 07 August 2026

Simon Kaye looks at the prospects for No10 North and the role it can play to help reset the relationship between local and national government

ASSET MANAGEMENT

Why the Golden Triangle matters

By Helen Bradley | 07 August 2026

Good governance is about more than legal compliance. Strong leadership and healthy organisational culture are fundamental to protecting public resources, mai...

Popular articles by Rob Whiteman CBE