Government sources dismissed the plan, put forward yesterday by the all- party Middle Way group of MPs, as a backdoor way of ensuring that hunting continues. They said it would not meet Tony Blair's pledge to outlaw the sport.
The MPs proposed that hunts should apply for a licence, which could be withdrawn if it carried out barbaric practices, such as dogs "digging out" a terrified fox underground. Hunts which refused to adopt a new code of conduct would be refused a licence.
"We are trying to create an environment which ends the worst excesses of animal treatment, at the same time as preserving the civil liberties of those who hunt," said Liberal Democrat MP Lembit Opik, a member of the group.
Jack Straw, the Home Secretary, will study the scheme but ministerial sources said last night that it did not go far enough. "It's not really a compromise, it is more like one side of the argument putting forward its views," said one source.
The pro-hunting Countryside Alliance, welcomed the MPs' proposal, but it was attacked by the League Against Cruel Sports, who said it would not prevent the chasing and deaths of foxes, deer and hare by packs of hounds.
David Coulthread, head of public affairs for the organisation, told BBC Radio 4 : "Nothing short of a full ban will be acceptable to an overwhelming majority of Labour MPs who have made it plain to Jack Straw that is what they expect."
Mr Straw, Mr Blair and other ministers will resume discussions next month and are expected to opt for a private member's bill rather than a government measure, because Mr Straw is reluctant to see his legislation overshadowed by a pitched Parliamentary battle over hunting. Ministers could ensure that a backbench bill won Commons approval by providing adequate Parliamentary time, but there would be a question mark over whether it would be passed by the House of Lords. Although the removal of most hereditary peers this autumn would curb the strong anti-hunting lobby in the Lords, some Labour peers oppose the move and the second chamber could delay the measure.