The Lib Dem party has vowed to take Hackney Council to court if fortnightly publication of its Town Hall rag does not cease when new legislation is introduced in April.

Any council which does not comply with the new rules restricting publication of “Town Hall Pravdas” to no more than four times a year could be held in contempt of court once the Local Audit and Accountability Bill comes into effect.

Eric Pickles, Secretary of State for Communities and Local Government spearheaded the new rules to deal with what he dubbed “a bunch of hard core local authorities” who persisted in using public funds to publish their “propaganda rags”, which threaten to “snuff out” the local independent press.

In April 2010 Mr Pickles introduced a code for councils, stating they should only release publications four times a year - but few local authorities complied.

Every fortnight 108,000 free copies of Hackney Today continued to be posted through residents’ letterboxes - much to the consternation of Lib Dem and Conservative councillors in the borough, who regard the paper as propaganda for the ruling Labour party.

Lib Dem spokesman Tony Harms said the paper was using a “much needed half million of public money for political purposes”.

“That money could be used in the discretionary fund to alleviate benefit cuts, and it seriously damages independent criticism in the local press,” he said.

“Once the bill receives royal assent and if the council ignores the code we will be looking closely at possible court action,” he warned.

Councils will have a statutory obligation to have regard to the code two months after the act has gained Royal assent, which is expected this month.

Any interested party can take councils not abiding by the new code to court, and if they still do not comply councils will be held in contempt of court.

A spokesman for the Department for Communities and Local Government said it would be “highly unusual for this to happen”.

Conservative Cllr Linda Kelly, who is standing for Hackney Mayor in May, welcomed the move: “Perhaps now they can stop wasting money on Hackney Today and focus on looking after the people of Hackney,” she said.

The council is obliged to publish statutory advertising fortnightly and claims publishing its own newspaper is the most cost-effective way of doing this.

A council spokesman said: “We are aware of forthcoming changes to the law which could affect the publication of Hackney Today and when this new statute is passed we will review our publication arrangements.”