Tony Blair will today give the green light to the biggest overhaul of the Home Office in decades, splitting the ministry into two and giving significant new counterterrorism powers to John Reid, the home secretary.

In a landmark move that seeks to draw a line under recent crises affecting the Home Office, the prime minister will announce that he is splitting the department into two entities - a ministry for national security under Mr Reid and a European style ministry of justice under the Lord Chancellor, Lord Falconer.