Malvern-based print and publishing business Aspect Design claimed that the council was using tax payers' money to undermine local businesses on a non-profit basis, while taking advantage of group purchasing powers.

Aspect Print partner Sue Smith said: "I went back over my books for the past six months and discovered that the council 'targets' represented 41% of our turnover.

"At a time when, in common with the rest of the industry, our sales and profits have declined significantly, this course of action by the council could prove fatal for us."

Paul Bullman, managing director at Great Malvern-based commercial printer Aldine Print, agreed. He said: "I have sympathy with the points made by Aspect Design – MHDC are not competing on a level playing field."

However, John Williams, head of performance and policy at MHDC, countered the claims, insisting that the council had a duty to support partners, as well as local voluntary and charitable organisations.

"For many of these local charities, we are not able to offer direct financial assistance, but we are able to offer printing at a cost which helps them to do their work in a more cost-effective way," he said.

"We realise that this could have an impact on some local businesses, but we believe that the relatively small amount of work we do is an appropriate balance of support between local businesses and local charities."