The change of pace was ordered by the Prime Minister after he visited Macedonia on Monday. A spokesman for Tony Blair said: "We will announce the figures as we go," but the Local Government Association's refugee project said it was drawing up plans to house as many as 20,000 people.
Non-governmental organisations immediately welcomed the government stance, but privately complained at the "massive pressure" created by Mr Straw's unexpected comments. One senior local government official said: "A lot of people are furious at this off-the-cuff announcement. Frankly this has taken us by surprise [although] we believe we can do this."
The Local Government Association said authorities had so far earmarked 3,500 places for refugees. The centres include old people's homes, children's homes, disused schools and council houses.
Mike Boyle, who is heading the asociation's refugee project, said: "We would be reluctant to go into larger camp-type accommodation unless there was no alternative. Ideally we are looking for buildings that can accommodate a plane-load of around 160.
"We will be drafting plans with the Refugee Council to provide accommodation for up to 20,000 refugees. In all probability we will be looking for places close to large metropolitan areas."
Nick Hardwick, chief executive of the Refugee Council, said: "This is going to be a challenging time. We need to make sure we maintain the good standards of accommodation and services we have been able to offer those who have recently arrived." The first group of 160 Kosovo Albanian evacuees to come to Britain were settled in Leeds 10 days ago. A second plane-load landed at East Midlands airport last week; they were housed in Leicestershire and Derbyshire.
Several other local authorities, including Sheffield, Manchester, Oldham and Liverpool, have indicated a willingness to accept refugees at some point.
The scale of the relief programme is likely to dwarf that of the Bosnian crisis, when 4,000 refugees were housed between 1992 and 1995.
The Home Secretary would not put an upper limit on the number of Kosovo refugees Britain was prepared to accept. "We have never believed we should establish a quota because the situation in Macedonia and Albania and the whole of Kosovo is an evolving one," he said.
Downing Street made clear Britain still fears that flying refugees out of the area could assist Slobodan Milosevic's policy of ethnic cleansing, and wants to ensure the refugees are returned to their homes in Kosovo. "It is a change of pace, not a change of policy," said the Downing Street spokesman.
The first flights begin on Sunday with two to Scotland.
As more refugees poured across the border from Kosovo into Albania yesterday, they brought with them more tales of atrocities by the Serbs against loved ones. More than 100 men were reported to have been dragged from a refugee convoy and shot dead by the roadside between the villages of Upper and Lower Studime, close to the town of Vucitrn in Kosovo.
Survivors say the convoy of a couple of thousand people was surrounded on Sunday night. "They killed my husband before my very eyes," Sebaate Gerxhaliu said, blank with grief as she sat in a tractor trailer clutching her youngest son. "At first they beat the men with rifle butts and knives, then they killed them."
At a House of Commons committee yesterday, Britain was urged by a senior United Nations official to keep its promise to bring in more refugees, amid warnings that the total number of people displaced by the conflict could rise as high as 1.25 million.
Steve Allen, Unicef special representative for the whole of former Yugoslavia, told an all-party group of MPs: "Clearly the pledge is there, but the implementation of the pledge is also important."
War in the Balkans, pages 4 and 5
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