JOHN REID is to announce plans for 8,000 new prison places to cope with the overcrowding crisis engulfing jails in England and Wales.

The move will be announced by the Home Secretary after a surge in jail sentences sent the prison population to a record 78,443 yesterday. Mr Reid plans to announce tomorrow a building programme costing hundreds of millions of pounds as part of a wider review of criminal justice that will involve changes to early release for offenders who have served half their sentence. The Home Secretary has been told that prisons in England and Wales may be full within weeks.

Officials have searched in vain for ships to hold offenders. They are now looking at a 300-space unit in the grounds of Ashworth top security mental hospital, in Merseyside, as emergency accommodation for prisoners.

Under Mr Reid?s proposals, the 8,000 prison places would be provided over the next five years, taking the prison capacity to 88,400 by 2011. The plan would involve two new jails, probably with as many as 1,000 cells. The rest of the cells would be in new units at existing jails.

The Prison Service has land available for new jails, including sites next to Belmarsh Prison, in southeast London, a site next to Ashworth Hospital and land near Leeds.

The move is the result of a deal that Mr Reid negotiated with Gordon Brown, the Chancellor. Funding will come initially from an underspend on capital expenditure in the Home Office. Mr Brown has given the Home Secretary permission ? exceptionally ? to use this money now. The rest will come from the 3 per cent efficiency savings created by the shake-up at the Home Office.

The figure was negotiated between Mr Reid and Mr Brown two weeks ago and was announced in last week?s spending review. It is understood that the Home Office had intended to build five jails but, at a cost of ?100,000 a cell, this was considered too expensive.

The number of people being sentenced to jail has risen almost relentlessly since 1993. But Mr Reid?s pledge to rebalance the criminal justice system in favour of the law-abiding majority will also mean more people being sent to prison, and for longer.

In addition, a new indeterminate sentence for dangerous and violent offenders is proving popular with the courts. In the past year more than 970 offenders have been given the sentence, which means that they will remain in prison indefinitely. Mr Reid will announce the result tomorrow of a review of early release arrangements.

Richard Garside, the acting director of the Centre for Crime and Justice Studies at King?s College London, said: ?This is the logical result of the Government?s fixation with finding simple criminal justice solutions to complex crime problems. It might help to ease the overcrowding problem in the short term. But it should not be confused with a serious long-term strategy to address crime and its causes.?

Today Mr Reid will announce plans to make the Immigration and Nationality Directorate, the organisation at the centre of the foreign prisoner scandal, semi-autonomous.

Failed asylum-seeker error

THE Home Office has hugely underestimated the number of failed asylum-seekers still in the country, John Reid will tell the Commons today (Richard Ford writes).

The Home Secretary is expected to say that a trawl through official records has uncovered between 400,000 and 450,000 asylum case files.

It is understood that officials are unable to say whether the individuals have left the country or have been given temporary permission to stay.

The disclosure, by the BBC last night, reveals the chaos that engulfed the Immigration and Nationality Directorate when it lost control of asylum and immigration in the late 1990s.

The Home Office refused to comment on the figures. A spokesman said that Mr Reid would be updating MPs today.