This Government has actively encouraged councils to make better use of their property assets, including selling surplus property, in order to free up brownfield land and to generate broader savings. Indeed, councils are sitting on £2.5 billion of surplus operational assets according to their own returns (source: DCLG, Local Government Finance Statistics England, June 2014).
Legally, the framework for the disposal of assets by local authorities, fire authorities and combined authorities is set out in the Local Government Act 1972. The legislation gives authorities the power to dispose of land as they see fit and for the best price reasonably obtainable. Local authorities are not always obliged to sell assets to the highest bidder. In certain circumstances they are free to accept a lower offer where the lower price is offset by wider public benefits. This is set out in the General Disposal Consent which permits local authorities to make disposals at less than best consideration without reference to the Secretary of State provided the undervalue does not exceed £2 million. In cases where a proposed disposal is not covered by this general consent an authority would have to apply to the Secretary of State for a specific consent. Each application is considered on its own merits.