MORE Secrecy, LESS Culpability

The work of Britain's security services will be permanently hidden from court hearings under plans designed to prevent a repeat of the million-pound payouts this week to Guantánamo Bay detainees.

A government green paper, which the justice secretary, Kenneth Clarke, yesterday told MPs would be published next summer, will contain specific proposals designed to prevent the courts from releasing the kind of information that has emerged from recent Guantánamo cases in the English courts. "It will absolutely eliminate [the possibility of] the process happening again," a well-placed Whitehall official claimed last night.

Ministers have been convinced by MI5 and MI6 that disclosing information held by the security and intelligence agencies – and notably information provided by foreign agencies such as the CIA – compromises Britain's national security.

Ministers and officials are planning a system whereby if intelligence material is relevant to a court case, it would be seen and heard in secret hearings and withheld from interested parties and their lawyers.

Clarke yesterday delivered a robust defence of the "mediated settlement" that emerged on Monday night between the government and 16 men held at the US military base on Cuba, which officials said they hoped would "draw a line" under highly damaging evidence of Britain's connivance in torture and abuse.

"The details of the settlement have been made subject to a legally binding confidentiality agreement," he told the Commons. "They have been reported in confidence to the chairman of the Intelligence and Security Committee [Sir Malcolm Rifkind] and to the National Audit Office."

Clarke added: "No admissions of culpability have been made in settling these cases. The alternative to any payments made would have been protracted and extremely expensive litigation in an uncertain legal environment in which the government could not be certain that it would be able to defend departments and the security and intelligence agencies without compromising national security." He said that there was a risk that public confidence was being eroded in Britain's adherence to human rights, including the rules governing the way the security and intelligence agencies work.

The cost of the case, had it continued, would have reached £30m-£50m over three to five years, he said. The settlement was welcomed by Sir John Sawers, head of MI6, and Jonathan Evans, head of MI5.

The settlement has stopped the disclosure to the high court of previously secret documents showing that former ministers, including Tony Blair and Jack Straw, were closely involved in the decision-making process that led to suspects being abducted and "rendered" to Guantánamo.

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