The Government's most senior law officer appears to have had a change of heart over using phone-tap transcripts to prosecute suspected terrorists.

For the first time, the Attorney General has made the case today for allowing intercept evidence in court, arguing that it would be an important tool in the fight against terrorism.

Previously the Government has said that it was opposed to the idea - backed by the Conservatives and Liberal Democrats and many of Labour's own backbenchers, as well as human rights activists - on the grounds that the secret intelligence service MI6 and the eavesdropping centre GCHQ allegedly feared that it might reveal too much about the way they operated.

Many senior police officers and customs officials support the use of phone-tap transcripts, which would be a way of bringing more suspects to court to stand trial rather than monitoring them indefinitely through the use of controversial control orders.

Stella Rimington, a former head of MI5, the domestic security service, has called the ban on intercept evidence "ridiculous".

Lord Goldsmith’s remarks - he is the first Government minister to advocate the removal of the ban - pave the way for the ban on phone-tap evidence to be scrapped. In an interview with The Guardian newspaper, Lord Goldsmith said: "I’m personally convinced we have to find a way of avoiding the difficulties.

"I do believe there are ways we can do that. Otherwise, we’re depriving ourselves of a key tool to prosecute serious and organised crime and terrorism."

As the Government's most senior law officer, Lord Goldsmith's view is likely to carry considerable weight in Cabinet. It is understood that he reached his change of heart after talking to Alberto Gonzales, his American counterpart, as well as senior judges, prosecutors and FBI executives, while on a visit to the United States.

Other opponents of the reform have argued that defence lawyers would overwhelm the police and security agencies with copious requests for transcript material, under laws obliging potential evidence to be disclosed to the defence.

Speaking from New York, Lord Goldsmith acknowledged this possible difficulty. He said: "We may need help from the legislature and the judges to avoid the agencies being swamped with irrelevant requests.

"But courts are already reining back on disclosure. No doubt there is more work to be done, but I believe we have to find a way...

"What I'm being told here is that the admissibility of intercept evidence is critical to some of their most difficult cases. They have put the top five mafia bosses in prison as a result of it."

Andrew Dismore, the Labour MP who is chairman of the joint Commons and Lords Committee on Human Rights, welcomed Lord Goldsmith’s intervention. "Our view is that it is vital that such evidence should be brought before the courts," he told BBC Radio 4’s Today programme.

"It is not really clear what the objections are. I think the key objection is probably because of the resource implications of replying to requests for disclosure.

"What we have certainly found from our inquiry was that intelligence services around the world, prosecution services around the world, simply could not understand why this vital evidence was not available to our courts."

Lord Goldsmith also said that he was increasingly convinced that America soon would finally ratify an extradition treaty, that was recently and controversially used to extradite three Britons who worked for NatWest bank to stand trial in America. Without America's ratification, the treaty only currently operates one way across the Atlantic.

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