IMAGINE a world where newspapers were unable to uncover a scandal striking at a major firm and saw millions of pounds being illegally taken from company accounts.

Imagine a world where newspapers were unable to challenge hospitals over care and councils over spiralling costs.

Imagine a world where newspapers were fearful of taking their MPs to task over government policies.

Under worrying new proposals, this could sadly become a reality.

It stems from plans to introduce legislation which could make newspapers liable for legal cases regardless of the result.

The Department for Culture, Media and Sport launched a consultation on press regulation, asking for views on Section 40 of the Crime and Courts Act 2013.

If brought into effect, it would make newspaper publishers liable for the costs of claimants in libel and certain privacy actions, regardless of whether or not they win the case in court.

The consultation closes at 5pm on January 10 and asks whether Section 40 should be revoked and whether the Leveson Inquiry should be terminated.

Should it be enacted, it could see newspapers fearful of pursuing investigations, knowing that whatever the result, they are going to pay substantial sums of money even when they are proved right.

It means that Echo investigations such as one to explore why a state-of-the-art scanner was standing mothballed for two years after a row raged on over its use could become costly and damaging.

Dr Norman Traub, of Picketts Avenue, in Leigh, secretary of the Southend branch of the Keep Our NHS Public campaign group, slammed the proposals describing them as “an attack on our freedom of speech.”

Mr Traub, 87, said: “It’s appalling and it’s an attack on our rights. The freedom of the press is a vital constituent of our democratic rights.

“It’s an attack on our freedom of expression. The larger newspapers which are in a better position will be able to afford challenges, the smaller ones won’t.

“The idea of subjecting newspapers to this legislation is an attack on our freedom of expression. It cannot happen.”

John Baron, Tory MP for Basildon and Billericay, told the Echo about his misgivings about implementing Section 40.

He said: “I instinctively dislike state regulation of the press and fear the chilling effect it may have on journalism if enacted.

“If newspapers know they will face all legal costs even if their story is 100 per cent true and accurate, it is not hard to see how editors may think twice before uncovering corruption and wrongdoing.

“I would imagine these considerations would weigh particularly heavily on local newspapers, which do not often have the resources of the national titles to cover high legal costs.

“Such a situation would seem to me to be a victory for the rich and powerful, and would not be in the public interest.”

Reformed regulation of the press has its routes after the prosecution of former News of the World journalists for phone hacking led to one of the most high-profile scandals in British media history.

Victims included the parents of missing Madeleine McCann, Sally Dowler, the mother of murdered teenager Milly Dowler, along with actors Steve Coogan and Hugh Grant, pictured.

Lord Justice Brian Leveson was appointed in July 2011 to chair a series of public hearings to review the general culture and ethics of the British media.

It is estimated that more than 50 politicians, sportsmen, other public figures and members of the public were victims of media intrusion.

Victims were invited to give evidence at the hearings, which saw a total of 337 witnesses called and about 300 other statements made.

Lord Leveson went on to make recommendations in a 2,000 page final report that a new, independent body, to replace the existing Press Complaints Commission, be created.

The Independent Press Standards Organisation was formed and acts as the independent regulator for the newspaper and magazine industry, and ensure publications follow the Editors’ Code of Conduct.

The second part of the Leveson inquiry has been delayed pending the outcome of criminal prosecutions of News of the World staff.

Simon Burns MP for Chelsmford and former Minister of State for Transport pleaded caution, and that the Government must find the right balance between public interest and welfare.

He said: “It is extremely difficult and I welcome the consultation, because it’s vital the government gets it right.

“We need to protect families who have suffered at the hands of the media, but at the same time protect the freedom of the press.