MoD plotted story sale while hostages were still in cells

Officials devised a detailed strategy on how to deal with media bids even as Faye Turney and her fellow captors were languishing in cells in Tehran, a senior Whitehall source has told the Daily Mail.

The revelation severely undermines claims by Defence Secretary Des Browne that he did not know in advance about the controversial decision to allow the accounts to be sold.

Insiders said it was inconceivable that he - and in turn Tony Blair - would not have been aware of the plan.

It also shows how, far from being pressured by the media, the MoD took an active part in controlling events.

Conservative MP Mark Lancaster, a serving Major in the Territorial Army, said: 'The more we delve the worse it gets. It is one thing saying they were forced to react in a difficult situation, but to actively plan is an entirely different story and I have great concerns about that.'

Mr Browne is becoming ever more isolated as he prepares to give a statement to the Commons on Monday. The Prime Minister cut him adrift on Wednesday by claiming to know nothing of the decision to break military precedent and allow the freed Marines and sailors to profit.

Last night Downing Street released a statement saying officials - including director of communications David Hill - played no part in the negotiations.

At the same time Foreign Office officials expressed their 'distaste' at the way there appeared to have been an 'overt' strategy to encourage Faye Turner and Arthur Batchelor to hawk accounts of their 13-day imprisonment for large sums.

It was previously thought that the decision to allow the sailors to cash in was made by the Royal Navy within hours of their arrival at Heathrow last week.

At the time, Second Sea Lord Vice Admiral Adrian Johns said the Navy had been forced to give in to pressure from the media 'waving big chequebooks around in front of them' and added: 'The decision was taken by the Royal Navy and then referred up the chain to the Ministry of Defence.'

Mr Browne has claimed he had only 'noted' the decision on Friday April 6, two days after the captives were released, and suggested the Navy were to blame. Mr Blair has insisted he knew of the move on Sunday April 8.

But the Whitehall source said a 'media strategy' had been in place for days because the MoD had already started to receive media bids.

Whitehall documents further undermined Mr Browne's claim that the Royal Navy took the key decision to allow the stories to be sold.

Orders issued two years ago insist that any media interviews must be cleared by the head of news management at the Ministry of Defence before a decision is taken - suggesting Mr Browne's officials endorsed the move.

The rules were introduced after the inquiry into the death of government scientist Dr David Kelly, who had been accused of talking out of turn to the BBC.

Lord Ramsbotham, a former director of public relations for the Army, said: 'My experience, certainly during the Falklands War and during the Beirut experience, was that everything was referred to Number 10 of some magnitude like this.'

Downing Street, however, continues flatly to deny being involved at any stage.