Communities Secretary, Eric Pickles, has announced proposals to clamp down on "town hall pravdas" and singled out Greenwich Council's weekly newspaper, Greenwich Time, as "one of the most blatant examples".
New guidelines put forward by the government would restrict councils to publishing their own free-sheets no more than four times a year.
Speaking exclusively to Greenwich.co.uk, the Secretary of State for Communities and Local Government said:
"Councils should be focusing resources on frontline services, not running one-sided Town Hall papers that threaten the genuine local press. 'Greenwich Time' is one of the most blatant examples of this practice that I've seen, and demonstrates why tightening the rules is so necessary."
The new rules, which are subject to consultation, would also impose stricter controls over the content that councils can publish. Local authority publications should only include "information for the public about the business, services and amenities of the council or other local service providers", according to the proposed code of practice.
Greenwich Council's controversial newspaper was the subject of a debate at the last full meeting of the council when local Conservatives put forward a motion calling it for to be axed.
Leader of Greenwich Conservatives, Cllr Spencer Drury, welcomed the government's announcement. He added:
"Greenwich Time undermines local business and publishes what I would describe as propaganda masquerading as news. I hope that this will encourage our existing local newspapers to revive their news reporting function and to start investigating the failures of Greenwich Council in a more systematic manner."
Council Leader, Cllr Chris Roberts, defended Greenwich Time at the last full council meeting. He said that the paper, which is delivered to homes across the borough, was "very close to being self financing" and allowed the council “to deliver statutory notices almost at no cost".