The move followed the publication of a study which found that GM maize was less harmful to the environment than the conventional crops and pesticides currently used in Britain.

The announcement will be made next week, but GM crops are unlikely to be planted commercially in Britain for at least another year, possibly not until after the next general election. It follows the lengthy farm-scale trials of GM maize, beet and oilseed rape, a scientific review and a programme of public consultation.

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Elliot Morley, the environment minister, said: "We have always made it clear that there will be no blanket approval. Every application will be decided on a case-by-case basis, If the science shows a particular crop should not be grown, we will not allow it to be grown.

"The Government is not an advocate for GM - we're not here to sell GM to anyone. If people don't want to buy GM produce they don't have to. Clear and accurate labelling is the key to informed consumer choice, and all GM products will be clearly labelled."

He said Britain had done more than any other country in considering the available evidence on GM crops with a science review, costs and benefits study, crop trials and a report on co-existence, as well as a public debate.

However, anti-GM campaigners said the decision was based on flawed science and warned Tony Blair that he was "picking a fight with the British people".

A positive decision next week will not give an immediate green light to commercial cultivation, as all applications for planting GM seeds must be approved by the European Union in Brussels.

Peter Hain, the Leader of the Commons, later assured MPs that they would be able to debate the decision before GM crops were grown commercially. "No GM seeds will be planted this year because the planting season has passed," he said.

The decision followed the publication of results from the three-year, farm-scale trials last month, carried out by Acre, the Government's advisory committee on releases to the environment.

They supported the growing of GM herbicide resistant maize but gave only qualified approval to GM herbicide-resistant oilseed rape and sugar beet. While GM maize was shown to increase biodiversity, GM rape and beet were shown to reduce farmland biodiversity and endanger insects, butterflies and birds.

The maize trials were criticised because GM crops were compared with conventional crops sprayed with atrazine - a chemical about to be banned. Critics called for a fairer comparison, with a less toxic pesticide.

The new peer-reviewed study, published yesterday on the online version of the science journal Nature, looked again at the small amount of data from the trials covering alternatives to atrazine and other triazine pesticides.

Prof Joe Perry, of the Rothamstead Research Institute, Harpenden, Hertfordshire, who led the study, said: "The comparative biodiversity benefits from GM herbicide-tolerant maize cropping would be reduced, but not eliminated by the withdrawal of triazines in the UK."

Sarah North, of Greenpeace, said: "Tony Blair has picked a fight with the British people. Once again he's pushing a pet project in spite of the evidence." The Government is braced for considerable public resistance to the decision and ministers may seek to defuse criticism by offering advice on the establishment of voluntary GM-free zones in areas of the country.