A council-funded community newspaper has been cleared of any wrongdoing over claims it was a campaign tool for the Labour Party.

An investigation into the North Edinburgh News was launched after it gave a short-term editorial role to a former Labour councillor, David Pickering, without the position being advertised.

A total of £25,000 had been given to the NEN by the City of Edinburgh Council’s Contact in the Capital project to help pay for the role.

David was offered the role by the paper’s board, which is chaired by Martin Hinds, also secretary of the Edinburgh Western constituency Labour party and the husband of city transport and environment convener Lesley Hinds.

Two Scottish National Party councillors, Frank Ross and Alex Lunn, had called for an immediate suspension of financial support to the paper, alleging a “misappropriation” of funds.

A letter from the pair to the council’s chief executive, Sue Bruce, highlighted the NEN board’s alleged “lack of political neutrality” and questioned why no “visible” digital media training strategy had been provided – even though this was agreed by councillors when funding was approved.

But the authority’s investigation found no evidence the NEN was operating outside official guidelines.

NEN leaders said they were “satisfied” to hear of the review findings.

Director Alex Dale told the Edinburgh Evening News: “I do not disagree that 30 years ago the paper was formed out of a socialist background in north Edinburgh, but in the last few years I’ve been there it’s been a totally apolitical paper.

“The NEN board are satisfied that the council have recognised the good work of a local newspaper and that they have been cleared of misappropriation of council funds.”