Chancellor George Osborne unveiled the cuts in a speech this week (24 May), claiming "urgent action" was needed to address the UK's budget deficit – estimated to be around £156bn.

As part of the planned £6.25bn spending cuts, the coalition government said "all new advertising and marketing spend" would be frozen until March 2011 with "only essential campaigns allowed".

The COI will see its funds squeezed by £160m and new spending on advertising campaigns above £25,000 will now be required to meet stringent approval tests over how important they are and what they will deliver.

A spokesman for the Cabinet Office said the types of campaigns considered essential "are those where there is a duty to inform the general public, situations such as changes in legislation".

Lucy Edwards, assistant managing director at Howard Hunt, which features in the web printing and direct mail framework agreements for the COI, said it was currently unclear what type of work would be most affected by the freeze.

"We budget for a certain amount of revenue, but you still have to fight for each contract. Just because you're on the roster doesn't mean you have a God-given right to it," she said.

"A lot of work we do are for things such as information leaflets for screening awareness. It's not clear whether that counts as advertising or just information."

The Cabinet Office spokesman added that campaigns where their impact is measurable would most likely continue, citing a recent anti-obesity drive where levels of obesity were found to have declined slightly as an example.