FP NEWSPAPERS INCOME FUND ANNOUNCES STRIKE SETTLEMENT AT THE WINNIPEG FREE PRESS

Vancouver, B.C. - October 17, 2002 - FP Newspapers Income Fund (TSX:FP.UN), publisher of the Winnipeg Free Press and the Brandon Sun, today issued the following statement on the status of labour negotiations with unions at the Winnipeg Free Press.

Today, following a union membership ratification meeting, a settlement was reached with striking workers at the Winnipeg Free Press. The settlement includes wage increases of 2% in each of the first two years of a new contract and 2.25% in the third year, as well as pension improvements.

The Winnipeg Free Press has been in contract negotiations with the Media Union of Manitoba (CEP Local 191), which represents editorial, advertising, circulation, mailroom and creative services staff and newspaper carriers, and the Graphic Communications International Union (Local 900M), which represents pressroom and technical services staff. The talks aimed to replace contracts that expired September 30, 2002 (except newspaper carriers, whose contract expired October 31, 2001). Publication halted on October 10 with the onset of a strike.

"We regret the disruption caused to our readers, advertisers, suppliers and employees, and look forward to resuming publication", said Rudy Redekop, President and Publisher. The newspaper intends to resume publication on Sunday, October 20.

The previously announced distribution to unitholders for the month of September will be paid as scheduled, on October 30, 2002. The distribution policy of FP Canadian Newspapers Limited Partnership is to distribute the distributable cash earned each month to its partners, including a subsidiary of the Fund. Management will assess the impact of the labour action on operating results, and the Fund will announce its October distribution on or before October 22, 2002.

FP Canadian Newspapers Limited Partnership owns the Winnipeg Free Press, the Brandon Sun, and their related businesses. The Winnipeg Free Press newspaper publishes seven days a week, serving Winnipeg and Manitoba with an average seven-day circulation of approximately of 129,000. The Brandon Sun also publishes seven days a week, serving the region with an average circulation of approximately 15,000. Based in Winnipeg, the businesses employ approximately 580 people in Winnipeg and Brandon. Further information can be found in the disclosure documents filed by FP Newspapers Income Fund with the securities regulatory authorities available at www.sedar.com.

Forward-looking statements
This document may contain forward-looking statements, relating to the Fund's operations or to the environment in which it operates, which are based on the Fund's operations, estimates, forecasts and projections. These statements are not guarantees of future performance and involve risks and uncertainties that are difficult to predict, and/or are beyond the Fund's control. A number of important factors could cause actual outcomes and results to differ materially from those expressed in these forward-looking statements. These factors include those set forth in other public filings. Consequently, readers should not place any undue reliance on such forward-looking statements. In addition, these forward-looking statements relate to the date on which they are made. FP Newspapers Income Fund disclaims any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.

For further information please contact:

Rudy Redekop, President and Publisher
FP Canadian Newspapers Limited Partnership
Phone (204) 697-7356, Fax (204) 697-7344
rudy.redekop@freepress.mb.ca

Kevin Karr, Vice President, Corporate Development and Secretary
FP Newspapers Income Fund
Phone (604) 646-3782, Fax (604) 681-8861
kkarr@estrellagroup.com