Greenwich Council's newspaper Greenwich Time was branded "appalling" and "blatant propaganda" by opposition councillors at Wednesday night's full council meeting.
The weekly was criticised in a Westminster debate earlier this month, with it and other council publications coming in for attacks from politicians and publishers of local newspapers, who claim it damages free speech and is hurting their business.
Conservative councillor Dermot Poston called it "an appalling piece of paper", adding it was "a shocking indictment" of the council.
"Ask anyone in this borough who reads it - not that anyone does - and they'll tell you," the Eltham North member said.
Brian Woodcraft (Lib Dem, Middle Park & Sutcliffe) said the paper, which was relaunched as a weekly in 2008, was "blatant propaganda".
"It contains a full week's TV listings, which is totally inappropriate for a local authority newspaper," he continued, questioning the cost of employing distributors to deliver it weekly, when previously it had been delivered fortnightly alongside the established local freesheets, the Mercury and the News Shopper.
However, council leader Chris Roberts (Labour, Peninsula) said it was more cost-effective to publish Greenwich Time once a week.
"It's cheaper weekly than fortnightly, and I'm happy to provide figures to any member who asks for them," he told the meeting.
He said the decision was made to distribute Greenwich Time separately because the council had received "too many complaints" that the newspaper was not being delivered, and residents were missing out on important items of public consultation.
"Neither the Mercury nor the News Shopper reach the whole borough," he added.
Addressing charges that the newspaper was propaganda, Cllr Roberts said: "Hammersmith and Fulham Council has its council tax plastered on its lamp posts - well beyond anything that goes on in this borough."
Referrring to criticism from News Shopper editor Richard Firth - who called the newspaper "a self-serving propaganda sheet" - Cllr Roberts called for an "honest debate" on the issue, reeling off a list of local newspapers published by newspaper group Archant, including The Docklands, a version of which appears in Greenwich as The Peninsula.
"I don't think the views of the Archant publishing house somehow go unreported," he said.
However, the News Shopper is published by Archant's rival Newsquest, part of US newspaper giant Gannett.
Nigel Fletcher (Conservative, Eltham North), complained that Greenwich Time routinely ignored opposition councillors' views, even on non-controversial matters such as Greenwich becoming a royal borough.
"Our views were represented in three of our local media; the Mercury, the News Shopper, and greenwich.co.uk; but the one local newspaper which neglected us was Greenwich Time.
"It was slightly absurd that a photograph of the leader of the council should have been on the front of Greenwich Time and not one of the Queen."
He said it "fully vindicated" his party's pledge to scrap the paper if it took power at May's elections.
Councillors vote for council tax freeze
Greenwich council taxpayers are set for a freeze in their bills after councillors voted through this year's budget proposals.
Council leader Chris Roberts said he had "no desire to slash and burn" public services, citing investment in transport, anti-crime measures, housing and children's centres, adding the cashflow plan was strong enough to deal with any government cuts after the general election.
"Whatever is thrown at us by central government over the next few years, the people of Greenwich will expect us to be prepared," he said.
"It is a budget which protects our essential services, and does not mortgage our futures."
With an eye to the council's own election in May, he said his Labour group had provided "stable and secure financial management for more than a decade".
Conservative leader Spencer Drury said freezing the budget seemed "the right thing to do".
But the Eltham North councillor questioned a sum of £3.7 million which was counted as cash to be held in reserve, but he said looked as if it had actually been allocated to services including continuing weekly black bin collections and covering extra costs in social care.
"These things are essentials," he said, "not things we have any choice over".
If that sum of money really was available, he said, then it should be returned to council tax payers "who are suffering too".
Cllr Roberts said he wanted to keep the extra sum of money aside in case the relevant departments needed extra cash for those services.
Council tax bills will not be finalised until after February 10, when London Mayor Boris Johnson's budget will be settled. He is also planning to freeze his part of the bill.
Royal borough status welcomed by all sides
Greenwich Council could buy a sailing ship to commemorate becoming a royal borough in 2012, Conservative culture spokesman Nigel Fletcher told the meeting.
Councillors from all parties welcomed the announcement, which was made earlier this month.
One idea, he said, would be to purchase a sailing ship to commemorate The Great Harry, a warship built at Woolwich for Henry VIII.
Cllr Fletcher said it was worth noting that royal connections were spread across the borough, and a ship would recognise Woolwich's contribution.
"It's an idea that could have a range of benefits, particularly for our youth," he said.
"There is a challenge to us to answer what becoming a royal borough means in real terms.
"It's up to us to use this to secure real benefits across the borough. There should be a Jubilee legacy to go with an Olympic legacy."
Greenwich will be the first royal borough with a "significantly diverse" population when it is awarded the honour in 2012, council leader Chris Roberts said.
"I have always felt the royal element of the borough has been underplayed," he said.
"Even those who declare themselves to be not tremendous royalists say how proud they are. It's an incredible honour."
Cllr Roberts said discussions would start soon on just what the honour, awarded to mark the Queen's Diamond Jubilee, would actually mean for the council, from possible changes to the council's coat of arms to putting the new borough names on street signs.
"There will be protocols to follow - I've been up to my eyeballs in them - but it will be up to us what to do, in consultation with civil servants and Buckingham Palace," he continued.
"I never thought I'd quote Margaret Thatcher, but 'rejoice, rejoice, rejoice'."
Long-serving Conservative Dermot Poston also spoke of his pride in seeing Greenwich's diverse population honoured, adding that in 1968, the borough had been turned down for the honour by then-prime minister Harold Wilson.
Councillor and historian Mary Mills (Labour, Peninsula) said Greenwich and Woolwich's royal connections had contributed to many of the borough's industries, adding that the honour recognised "all sorts of ordinary people going way back".
Chris Roberts added that he had been touched by letters from people about the honour, adding: "My personal favourite is from a lady who wrote, 'I'm just waiting for the first journalist to knock it.'"