Councils such as Tower Hamlets have been warned they could face court action if they continue to publish their own tax-funded newspapers.

Local government and communities secretary Eric Pickles told journalists this week that he is considering judicial review proceedings against councils, who flout his new publicity code, designed to clamp down on Soviet-style ‘Pravdas’.

The guidelines issued earlier this year says that local authorities must not publish newspapers more than four times a year and should only include material directly related to local services.

Tower Hamlets Mayor Lutfur Rahman chose to ignore the government guidelines at a cabinet meeting last month when it was

decided Tower Hamlets will continue to publish its paper East End Life every week.

Speaking at a Newspaper Conference lunch, Mr Pickles was asked if anything could be done about local authorities such as Tower Hamlets which still publish weekly newspapers.

He replied: “I suspect the longer it goes on the more cocky and unreasonable they will be. I think judicial review is possibly the thing that councils have to face.

“I came to a view that local newspapers produced by local authorities were effectively squeezing the market out and I wanted to try and ensure that there was some scrutiny.”

The new guidelines also state that council papers should not mimic commercial ones, and must remain fair and impartial.

East End Life costs �1.5 million a year to run but the council says it expects to recoup the full costs through advertising in the coming years.