He also announced plans to help local Iraqis who have worked for British forces in the country since the 2003 US-led invasion to settle.

"We plan for next spring to reduce force numbers in southern Iraq to a figure of 2,500," he told parliament's lower House of Commons.

Brown had already announced on a visit to Baghdad last week that there would be 1,000 fewer troops in Iraq by the end of the year, taking troop numbers down to 4,500.

He said Monday that the reduction down to 4,500 would come immediately after Britain hands over control of Basra Province in southern Iraq to the Iraqi forces in the next two months.

Brown outlined "two distinct stages" to the handover: the first would see British forces training and mentoring Iraqi security forces, securing supply routes, protecting the Iraq-Iran border and provide back-up to local troops.

In the second, he said British forces would retain a more limited ability to intervene by force with the main focus on training.

Meanwhile Brown confirmed that London will help Iraqi local staff who have worked for British forces to settle in Iraq and elsewhere, including Britain under agreed circumstances.

Local staff including interpreters and translators who have worked for Britain for 12 months or more will be eligible for financial and other support, he said in a long-awaited statement to lawmakers.

"I am pleased to announce today a new policy which more fully recognises the contribution made by our local Iraqi staff who work for our armed forces and civilian missions in uniquely difficult circumstances.

"Existing staff who have been employed by us for more than 12 months and have completed their work will be able to apply for a package of financial payments to aid resettlement elsewhere in Iraq or elsewhere in the region or -- in agreed circumstances -- for admission to the UK."

Earlier Brown said the withdrawal of British troops from Iraq was not a sign of failure, but a decision based on the Iraqis capacity to run their own security.

"Therefore, you cannot see the reduction of troops as an admission of defeat or a run-down or as a threat to security. It is the other way round," he told his monthly news conference in London.

"When we announced less troops in Iraq, it is because we are winning the security battle and that there is a lull in some of the fighting that is taking place in Iraq -- and we hope it's a permanent lull."

After last week's announcement Brown was accused of "cynical politics" because a reduction of 500 troops, included in the 1,000, had previously been announced and 250 of them had already returned home.

Brown rejected claims of media manipulation in an interview with BBC television broadcast Sunday, saying he had had to go to talk with military commanders on the ground and the Iraqi government.

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