Burglars, drug dealers and fraudsters could be released from jail early to ease prison overcrowding.

Justice Minister Lord Falconer said eligible inmates could be freed up to 18 days early as part of the initiative as the prison population topped 81,000.

Lord Falconer told the House of Lords that the scheme applied to criminals serving jail sentences of four years or less.

Jail terms being served by serious sex offenders or foreign nationals facing deportation at the end of their sentence will not be affected.

Lord Falconer described the move as a temporary emergency measure which will come into force on June 29.

He also announced the creation of 1,500 extra prison places, the first of which would be available in January 2008.

Lord Falconer insisted the new guidance for jail governors would only allow individuals to be let out on licence.

"Releasing people on licence means their sentence continues," he said.

"The criteria exclude offenders convicted of serious sexual or violent crimes, those who have broken the terms of temporary release in the past and foreign national prisoners who would be subject to deportation at the end of their sentence."

The use of police cells to accommodate convicts will continue until the end of this year.

The Prison Governors Association has called for early releases to provide a "breathing space" and end the £1 million-a-week cost of holding convicts in court and police cells.