Two struggling councils have been warned they face government intervention unless they selloff publicly-owned assets, including town halls, public toilets, leisure centres and libraries, and push ahead with further cuts to services. The threat by local government minister, Kemi Badenoch, followed publication of reviews into the two councils’ finances which concluded both ran the risk of failing to balance their budget – effectively going bankrupt – without urgent action. Badenoch told Peterborough city council, which is run by the Conservatives in alliance with independents, and Wirral council – run by a minority Labour administration – they must set out plans within 30 days to balance the books or face possible intervention. “Any faltering in this area would be of considerable concern and could lead to a reconsideration as to whether a different approach might be appropriate to secure the improvements that are necessary,” she wrote. The National Audit Office said this year that at least 25 councils in England were on the edge of bankruptcy after years of cuts, and amid soaring cost pressures. The pandemic has added more issues and both Slough and Croydon councils have declared effective bankruptcy in recent months. Peterborough – whose leader warned that “difficult choices” lay ahead – was told by Badenoch it had still not “fully grasped” the scale of its financial challenges, while in a separate letter she told Wirral it “had not fully acknowledged or perhaps even understood the severity” of its position. Both councils have made tens of millions of pounds of cuts in recent years, despite rising demand for services, particularly in adult social care and children’s services. Both have applied to government for financial support in recent months after concerns they would not be able to balance their budgets. The review of Peterborough’s finances said it had lost nearly £100m in government funding over the past decade. The council told reviewers services were now at “dangerously low levels” after repeated cuts in recent years and had in some cases reached a basic legal minimum service. However, the reviews insisted both councils had scope to make further cuts to services and should embark on a sale of assets. In Peterborough’s case this should include the sale of 3,000 acres of farmland, which currently bring in rent of £400,000 a year, the council town hall, and several office blocks. The review of Wirral’s finances concluded that it should sell off a raft of council-owned assets including golf courses, youth clubs, libraries, leisure centres, community centres, public toilets and office buildings to raise cash to balance its budget. The review criticised Wirral council’s apparent reluctance to make cuts or sack staff, saying it had a culture of avoiding “difficult financial decisions”. It said: “Until members and officers face up to the need to have to make difficult decisions … its financial sustainability remains uncertain.” Wayne Fitzgerald, the leader of Peterborough council, said: “The report acknowledges the very significant challenges we have faced in the past but also recognises that Peterborough’s services perform well and are low cost.” He added: “It is clear though that I as leader, including all other members, regardless of political party, must take on board the seriousness of these reports and set about implementing some of the recommendations which will mean that very difficult choices are ahead. “Going forward I want to invest more in services for residents and see the city continue to prosper and grow, but we will need the finances to do so.” Paul Satoor, chief executive of Wirral council, said: “We will take time to fully digest the findings and recommendations made in these reviews.”