Ministers have backed down over plans to remove the requirement on councils to advertise roadworks and other planned traffic changes in local newspapers.
The proposal, which the Newspaper Society claimed could have cost the industry up to £20m a year, was first mooted in a consultation document by the Department for Transport last year.
Transport minister Norman Baker has now told the Commons the plan will not go ahead following opposition from the industry and from MPs.
But the move has proved controversial among Conservatives, with one prominent Tory blogger claiming councils are being forced to subsidise the local press.
Iain Dale wrote in a blogpost: “Effectively, local government is subsidising local newspapers to the hilt. And council tax is therefore rather higher than it need be.
“Local media is important, whether it be print or broadcast. But this cash cow won’t be there for ever and local newspapers would be wise to plan for a future without these public service adverts. Sooner or later they will be gone.”
Mr Baker said in a written Commons answer that a clear majority of responses from local government had been in favour of the proposed change, while a clear majority of responses from MPs and local newspapers were against.
He added: “I have therefore decided to not change the present arrangements at this point, but, with colleagues across Government, to keep the matter under review.”
Responding to the announcement, the NS said: “The Government has rightly abandoned the proposals to remove Traffic Regulation Orders from local papers which could have resulted in important information being hidden from public view.
“The outcome of this consultation has again demonstrated that local papers are the most effective medium to communicate public notices and that the public wish for them to remain there.
“The Home Office, which is currently consulting on dropping mandatory local newspaper advertising of applications for alcohol licences, should take note of this outcome and the outcome of similar consultations in recent years relating to planning notices and traffic notices in Wales.”