Prime minister Tony Blair has given the strongest signal yet that he will give councils the power to ban smoking in public places.
The government is consulting on the issue as it prepares a white paper, Choosing health, to be published in the autumn.
He said there was a difficult balance between protecting the public's health and being seen as a nanny state. He stressed: 'In the end, you have also got to have some local decision-making in this.'
Downing Street advisers see the issue as being similar to congestion charging, in that Mr Blair is prepared to give councils the power to introduce a controversial measure but wants them to take the blame if it proves unpopular.
Proposals to allow councils to outlaw smoking in workplaces, pubs and restaurants are thought likely to be included in Labour's manifesto for the general election, expected next June.
Shifting the burden on to councils is a compromise measure, given the strong opposition to regulation by members of the Cabinet, including culture secretary Tessa Jowell and health secretary John Reid.
Some councils have been lobbying for the new powers, but all will be relieved to avoid being compelled to implement and enforce a ban.
The Welsh Assembly has voted in favour of a ban, but has no powers to implement one. Some Scottish councils also want the powers, which would require a parallel bill at Holyrood.
Anti-smoking campaigners welcomed Mr Blair's comments. ASH director Deborah Arnott said a national ban was preferable but powers for councils were a 'step in the right direction'.
However there was strong opposition from the Tobacco Manufacturers' Association, and the smokers' lobby group the Freedom Organisation for the Right to Enjoy Smoking Tobacco.