Such outsourcing would be accompanied by tougher legal safeguards to guarantee against leaks and accidental data losses, the newspaper said, citing a consultation paper.

However, involving the private sector in handling such sensitive data is bound to generate more trouble for the plan, particularly given a series of high-profile losses of computers, disks and hard drives storing such material in recent years. The steady stream of data blunders has kept the spotlight on the way the government handles _ or mishandles _ its citizens' information.

Britain's Home Office will consult the public and communications industry on the proposals starting next month, but declined to say on Wednesday whether an option for a private company to manage the database will be included in documents circulated for discussion.

The government previously dropped plans to include the proposal in the annual legislative program announced earlier this month, saying more debate was necessary.

Civil liberties groups have expressed concern about the database, which would create an unprecedented store of information on each individual's private communications in hopes of tracking the movements of criminals or terrorists.

Ken Macdonald, who stepped down as Britain's director of public prosecutions in October, said the plans to create a database are the stuff of a "paranoid fantasy."

"No other country is considering such a drastic step," Macdonald was quoted by the Guardian as saying.

Such a database would provide "a complete readout of every citizen's life in the most intimate and demeaning detail."

"The notion of total security is a paranoid fantasy which would destroy everything that makes living worthwhile," he was quoted as saying. "We must avoid surrendering our freedom."

Intelligence agencies _ including the Government Communication Headquarters eavesdropping center _ complain that their ability to intercept or trace records of exchanges between criminal or terrorism suspects is being compromised by a failure to address advances in technology.

Security officials say terror suspects now commonly use combinations of phone calls, SMS messages, Internet chat rooms and instant messaging to discuss plots _ meaning investigators need access to a wide range of data.

In a speech in October, Home Secretary Jacqui Smith said the planned database is vital if communications data is to continue to be used to fight crime. She said such data had been used as evidence in around 95 percent of recent major criminal cases.

Responding to technological changes "is not a government policy which is somehow optional. It is a reality to which government needs to respond," Smith said.

Smith said that the database won't store the content of calls, e-mails or Internet use _ but would include details of times, dates, phone numbers, e-mail addresses and Web site URLs.

"To ensure that we keep up with technological advances we intend to consult widely on proposals in the New Year," a Home Office spokesman said Wednesday, while speaking on condition of anonymity in line with ministry policy.

Police and intelligence services currently rely on billing information stored by Internet service providers and telecommunication companies to trawl a suspect's phone contacts or Internet use. Figures released under Freedom of Information laws show British police paid 8.6 million pounds ($12.5 million) to cell phone companies for access to records in 2007.