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Public assets 'at risk of being undervalued'

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One in six councils have been forced to dispose of public assets “for less than optimal value”, according to a report.

Figures from thinktank Localis show local authorities are seeking to redevelop £13.5bn worth of land and assets over the next five years. Localis has calculated that up to £2.3bn worth of assets could be undersold in that time.

It said if these assets were sold at 10% below value, it would constitute more than £45m lost to the public purse each year, and nearly £230m over the course of the next parliament.

The findings from the survey of more than 50 council chief executives and leaders are contained in a report about obtaining the maximum value from public land and property.

The report said the most recent Treasury guidance on the sale of public assets gave the message that they must be sold “as quickly as you can, as best as you can”. It urged the government to update the guidance as more than a quarter of the survey respondents believed having more time would yield better returns.

Speaking at the report’s launch on Wednesday, housing and planning minister Brandon Lewis said: “The whole of government, both central and local, will need to work together if we are to make the most of public assets in our trust.

“Central government cannot and should not prescribe the ‘right’ solutions across the country because these will be different in every area and decisions will have to be made to suit that area.

“But there’s no doubt these will drive efficiencies.”

Mr Lewis said property and asset management had been an area of local government that had been “left for far too long to gather quite expensive dust” but added now is “a great opportunity for central and local government together to meet the challenges ahead”.

“It’s quite right we make sure we are making the most of all of our public assets,” he added.

Meanwhile, when Mr Lewis was asked about garden cities he said he did not have a target for how many there should be but added there would be an announcement in the near future.

“Quite a few areas have come forward with quite ambitious plans,” he said.

Mr Lewis said he wanted local authorities and developers to “get away from building big estates” with identikit houses and urged councils to “get into the quality and detail” of applications to help prevent that.

“If you build these houses you have got to make sure there’s a community feel to it,” he said.

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