MPS have urged the Government to safeguard local newspapers from the “unfair” competition of council-run publications.

Liberal Democrats urged ministers to take action against council newspapers during a debate in London’s Westminster Hall.

MP Paul Burstow said there would be a public outcry if Gordon Brown were to create a Government newspaper – but this was happening routinely at local level.

Mr Burstow, the MP for Sutton and Cheam, called on the Competition Commission and Audit Commission to look into the impact of increasing numbers of council-funded newspapers on free speech.

Local newspapers were the lifeblood of our democracy and council publications went way beyond providing information about local services, he said.

The Northern Echo’s Editor, Peter Barron, has joined criticism of the publications for driving out genuine local newspapers by taking advertising away.

A survey by The Northern Echo found that 11 out of 12 local authorities in the region produce publications, at frequencies ranging from twice a year to once a month – spending more than £1m a year.

The biggest spender was North Yorkshire County Council, paying more than £480,000 producing 11 issues of the NY Times.

Mr Burstow told the debate that local authority-funded newspapers were written to see the world through the tinted glasses of the party in charge of the council.

“Taxpayers’ money is being used for the production and distribution of loss-making council-run papers,” he said.

Earlier this year, the Government asked the Audit Commission to carry out an inquiry into the impact of council newspapers on the local press.

But the commission decided instead to look into whether such papers delivered value for money for the taxpayer – a remit that was not good enough, according to Mr Burstow.

MPs from all sides expressed concern that statutory notices were being moved to council freesheets and local papers were also losing muchneeded advertising revenue.

Labour’s Andy Slaughter said council newspapers were nothing more than propaganda and masqueraded as independent media.