Addressing troops at the Contingency Operating Base at Basra, where most of the UK troops are now based, Mr Brown revealed that he had just spoken to Iraqi Prime Minister Nouri Maliki who approved the handover. Mr Maliki is recommending that British troops move to provincial Iraqi control within two weeks, Mr Brown said.

The remaining British troops will focus more on training local Iraqi forces, before UK numbers reduce down to 2,500 from the spring. There are now 30,000 Iraqi police and armed forces in the region.

The Prime Minister added that Iraq is now in a "far better position" thanks to the efforts of British personnel:

"I know many of you will not be home for Christmas but I do appreciate the spirit of service that means you are serving here the national interest at Christmas time," he said.

"Let me wish you a happy Christmas, say you have achieved great things during the course of the year, pay tribute to your professionalism, your courage and your patriotism and wish all of you well in the new year ahead. The whole British people are proud of everything you have achieved."

After addressing the troops Mr Brown went into private talks with senior British commanders at the base, which is home to the headquarters of the Multi-National Division South East in Iraq.