Four-and-a-half years of British military control in southern Iraq came to an end today with the handover of Basra Province in a curiously low-key ceremony at the city's airport.

Before an audience of around 100 guests, including David Miliband, the Foreign Secretary, Basra province was handed back to full Iraqi control though the signing of a simple memorandum of understanding.

There was little pomp or overblown ceremony, nor even a Union flag on display to mark an event seen as heralding Britain’s departure from Iraq after the most contentious military venture of modern times.

“I commanded the coalition troops which entered Basra in April 2003, four-and-a-half years later I have the privilege of handing this city back,” said Major-General Graham Binns, commander of British forces in southern Iraq, as he signed the agreement.

“I came to rid Basra of its enemies and I now formally hand Basra back to its friends. This is a city forever close to my heart.”

Basra is the last of the four provinces placed under UK responsibility in the wake of the 2003 US-led invasion to come fully under Iraqi control. While administrative power is already in local hands, today’s move passes over responsibility for the thornier issue of security.

It does not end the UK’s combat role entirely but, for the first time since the Iraq War began, British commanders will no longer be able to carry out military strikes without first being asked to do so.

The widely anticipated move is a landmark on the path to full British withdrawal from Iraq.It clears the way for British troop numbers in the country to be slashed to just 2,500 by early next year at a time when extra forces may be needed in Afghanistan.

At the height of Operation Telic, the British military mission in Iraq, in 2003 that number stood at 46,000. Since then 174 servicemen and women have died while serving in the theatre.

Basra Palace, the last British base in the second city, was handed over to Iraqi troops in September. Since then UK forces have been concentrated at the airport, firmly outside the city limits.

The pull-out led to a dramatic drop in attacks on British troops but critics say the move has simply handed power to Shia Muslim militias. Last month a bleak report by the Commons Defence Select Committee suggested that Britain was preparing to hand over without fulfilling the goal of establishing security.

Muwaffaq al-Rubaie, Iraq's national security adviser, said that the handover was a "great, great, great day for Iraq" and a 'huge test for Basrawis".

“Thank you very much for everybody who has contributed to this, the first and last word is for the Basrawis. Without your sacrifice, without your blood, without the treasure and sweat and tears you have invested in liberating this city and this province, and in building the Iraqi security forces; without this sacrifice we would not be here now," he said.

Speaking afterwards, Mr Miliband indicated that there could be a decision on further British troop reductions within months but conceded that Basra remained a dangerous place.

He said: “The key conditions for the transfer of security responsibility to the Iraqi security forces are whether they are up to it: Do they have the numbers? Do they have the leadership and training to provide leadership for this province?

“And the answer to those three questions is yes: 31,000 members of the Iraqi security forces, outstanding leadership from General Mohan, training in skills from the British Army - and it doesn’t come much better than from the British Army.

“So this is now an Iraqi security force able to provide security for the province. Does this mean that this is like Tunbridge Wells on a Sunday afternoon? No it doesn’t. Basra remains a dangerous place, much less because of the militias that were such a problem six months ago but continuing criminal violence - that is an issue, a priority, I know, for the security forces."

But Vince Cable, acting leader of the Liberal Democrats, said that Gordon Brown should take advantage of the handover to set a timetable to bring all British troops home from Iraq. “If we are handing power back to the Iraqis, why are 4,500 British troops needed for what is essentially a training mission?" he said. “There is no justification for our continuing presence in Iraq given that the British armed forces are so overstretched."

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