Liverpool city council has purchased Everton's Finch Farm training ground in a £12.925m deal that will reduce the club's rent on the complex.

Everton, who retain a 50-year tenancy agreement on the facility, had rented Finch Farm from a private company since 2007 but will pay reduced annual costs under the ownership of a council that has made £141m worth of cuts over the past two years.

Liverpool city council made the investment despite recently announcing £32m worth of cuts for the next financial year, including the closure of 10 libraries and ending grants for school uniforms. It expects the loan for the purchase to be paid off in 25 years and to make money to reinvest in local services over the remaining 15 years of the 40-year deal, which has been independently valued and verified.

Joe Anderson, the elected mayor of Liverpool, told BBC Radio Merseyside: "To those people who say: 'How can you do this when you are making cuts?' – you can't borrow for revenue. We are trying to look to the city's future as funding cuts come from central government. The city expects us to create investment.

"Everton, with Liverpool city council, have reached agreement on this. We didn't go knocking on Everton's door. They approached us and we negotiated a deal that saves them money. If Liverpool had approached us we would do the same. We have to work in partnership with our local businesses and we are working with Liverpool on their stadium plans. We will be making an announcement on that next week. Everton are happy with this and so are we."