The editor of the Barking and Dagenham Recorder has slammed as "a stab in the back" plans by a London borough to pull its advertising from the local press and transfer it to a new fortnightly newspaper-style publication it is launching this spring.
The News will be a free paper distributed by Barking and Dagenham Council to 90,000 homes, businesses, train stations and schools each fortnight from the end of May.
It replaces a former council-owned monthly magazine, The Citizen, and two other publications, Spotlight and Neighbourhood Matters.
Press Gazette understands the paper will have eight staff and will seek to be self-financing by competing for advertising from the commercial market - not just from the council.
Barking and Dagenham Recorder editor Chris Carter said council chiefs had informed him that they were pulling all advertising from the Archant-owned Recorder and its sister title, the Barking and Dagenham Post.
He told Press Gazette that the move would cost the local papers about £75,000 a year in lost revenue.
'It is a major blow but we will fight it,'Carter said.
'They say they are going to be a community paper but that's what we already do.
'I think this could happen elsewhere and have major implications for the local press.
'It is a stab in the back and something you could do without in this economic climate.
'I think local councils should be supporting local businesses."
Carter believes The News could be modelled on East End Life, the newspaper-style publication put out by Tower Hamlets Council, which has come under fire from another Archant editor, Malcolm Starbrook of the East London Advertiser.
The council claims the idea for The News came after market research showed that its existing publications were 'not getting through to residents".
A decision was taken to launch a newspaper after talking to other councils that have launched similar successful publications.
A council spokesman said The News would concentrate on community rather than hard news and statutory advertising from the council would still go into the local press.
Barking and Dagenham Council chief executive Rob Whiteman said: 'The News will be a newspaper for the community, with more timely information and greater community engagement.
'This new initiative will save over £75,000 per annum through savings in advertising expenditure and streamlining our publications.'
He added: 'We have talked to residents in recent months and they told us they want one community-based publication that reflects pride in the borough and provides honest, factual and useful information.
'In these tough economic times, we are also delighted to be able to provide an improved and more efficient service."