British and Iraqi commanders in Basra had their own troop-surge plan to rid the city of Shia militia extremists but it was vetoed by the Iraqi Prime Minister, the Ministry of Defence has confirmed.

The third and final phase of the plan, which would have involved a surge of Iraqi troops into Basra with “low-profile” support from British troops, was due to have started this month. When it was presented to Nouri al-Maliki, the Iraqi Prime Minister, on March 21, however, he surprised the British by announcing that he had his own troop-surge plan that he would launch the following day, with 900 American soldiers and Marines being sent into Basra.

Colonel Robert Castellvi, the senior American Marine adviser to the 1st Iraqi Army Division sent down to Basra, described exclusively to The Times what he found when he arrived in the southern city in March. “The Iraqi forces that had been in the city had been defeated. There were whole swaths of the city under militia control,” he said. “The provincial government had stopped functioning as a government that provides security for the people. There were dead bodies and burnt-out vehicles on the streets.”

The rejection of the longer-term plan drawn up by General Mohan al-Firaiji, then the Iraqi commander in Basra, in collaboration with the British military, was the latest blow in relations between Mr al-Maliki and the British commanders in the south.

The Iraqi leader was already reported to be disillusioned with the British after they had negotiated a deal with Shia militia the previous summer, under which 500 soldiers besieged in the centre of Basra were able to withdraw without being attacked. The pull-out of the last remaining British troops in the city in September last year meant that the entire 4,000-man force was encamped at the airport base northwest of Basra. The British have since returned, putting 900 troops back in the city.

Yesterday MoD officials confirmed for the first time that there had been discussions with the Shia militia, leading to the withdrawal of the 500 soldiers. An MoD spokesman rejected American military claims, reported in The Times yesterday, that this secret deal prevented British troops from being involved in Mr al-Maliki’s unexpected decision to mount Operation Charge of the Knights – the troop surge into Basra on March 25. “Mr al-Maliki did not want us to send troops into Basra,” an MoD source said.

In response to the story in The Times, Des Browne, the Defence Secretary, said last night: “Our forces were not prevented from going into Basra by any deal of any sort. I have the greatest confidence in the judgment of UK military commanders and I would never seek to constrain their ability to make decisions out in theatre.”

Under General al-Firaiji’s British-sponsored three-phase plan, the first stage was to have involved an intensive training programme to get the Iraqi Army’s 14 Division, which had been sent to Basra, up to combat-ready levels. The second phase was to involve negotiations with the Iraqi Government to guarantee economic development in Basra. The third phase, fixed for August, was to launch a large-scale operation in Basra, with 14 Division reinforced by Iraqi troops from Baghdad.

The plan was taken up to Baghdad on March 21 and presented to General David Petraeus, the US commander of the Multinational Corps, who showed it to Mr al-Maliki. It was then that the Iraqi Prime Minister announced that he wanted to send troops down to Basra the next day. Thousands of Iraqi troops with 900 American minders from the US Marine Corps and 82nd Airborne Division, as well as specialist planners from the 1,000-strong coalition corps headquarters in Baghdad, arrived the next day at the British airport base. The British provided Challenger 2 tanks as well as artillery units and RAF Tornados, but no combat troops were requested.

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