English councils are sitting on £250bn of property assets, but only 20% of council finance directors have all the information they need to manage their estates, according to an Audit Commission report published today.

The report points to the uphill struggle that local authorities will face in cutting costs as the government tries to trim ballooning public sector deficits.

Bharat Shah, deputy chairman of the Audit Commission, said the simultaneous collapse of the property market and the parlous state of the public finances meant that councils were going to face years of straitened living.

'We have been living in a very benign climate up to now, but the party is over. The world has changed and there is going to be increasing pressure on capital as well as revenue spending,' he said.

Financial Times