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Office of Fair Trading looks into council newspapers on the rates

PUBLISHED: 21:07 19 April 2009 | UPDATED: 14:17 05 October 2010

THE Office of Fair Trading is looking at the effects on Britain's struggling local press by town halls running their own free newspapers out of council tax. It is part of a review into press ownership and follows a consultation paper in which the competition watchdog invited the regional publishing industry to submit evidence about the public sector media

By Malcolm Starbrook

THE Office of Fair Trading is looking at the effects on Britain's struggling local press by town halls running their own free newspapers out of council tax.

It is part of a review into press ownership and follows a consultation paper in which the competition watchdog invited the regional publishing industry to submit evidence about the public sector media.

The OFT has so far held meetings with the Newspaper Society and the newly formed Local Media Alliance which have both raised fears about the impact town halls are having on the already-fragile regional media.

RISING PRESSURE

Publishers are under increasing pressure from public sector bodies developing their own media outlets such as newspapers and online TV channels paid for out of council tax, it has been told.

The local authorities that submitted a response to the OFT investigation argued that their own communications were important to ensure accountability.

Some said it was important to make a distinction between reducing their ad costs in local newspapers and directly competing for advertising revenue in the open market.

BATTLEGROUND

The situation in East London is becoming more of a battleground.

Barking & Dagenham council is to launch a newspaper paid for by local taxes which is to carry council advertising rather than the authority placing ads in the local press as it has always done traditionally for the past 90 years. Neighbouring Newham is now considering launching its own newspaper.

Both follow the example of Tower Hamlets which has been running its weekly East End Life launched in direct competition with the long-established East London Advertiser which marked its 122nd anniversary in November. It is paid for out of town hall coffers—both the printing and its massive distribution to nearly every property in the East End.

BIASED

The Advertiser has been running its own campaign with Government ministers, now backed by Opposition local councillors this week.

Both Conservative and Respect Opposition groups on Tower Hamlets council have complained that the Labour-controlled East End Life ignored their alternative budget proposals. They claim it is biased while only giving coverage to Labour’s budget—which is one of the few in London to rise this year.

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