New eruptions threaten the islands capital

Britain Will Re-build Montserrat

Ms Short gave her reassurances came after discussions about the British colony's future with the Chief Minister of Montserrat, Bertrand Osborne.

The talks followed Monday's panic when two volcanic eruptions at Soufriere Hills sparked by a two-hour-long earthquake sent hundreds of residents fleeing north

But the timing of consultation talks which will decide the islands future, originally thought to be scheduled for September, has still to be decided.

"I have just had a very useful meeting," said Ms Short. "We have agreed Britain is committed to creating a viable future for Montserrat."

She said the choices available must be made clear to all the islanders. With more than half the island now lying in an exclusion zone, hopes centre on British Government-funded housing schemes planned for a 15-square-mile safe area in the north.

Over half the island's population have left since the crisis began

Priority will be given to islanders living in makeshift accommodation in churches, church halls, schools and small buildings. In some cases, up to 200 people are housed in a single small shelter.

Mr Osborne said new homes could be found for them in the next three months. Despite the recent exodus after a volcanic eruption on June 25 that killed 10 people and left nine missing and believed dead, Ms Short said a full-scale evacuation of Montserrat which lies about 25-miles southwest of Antigua was never on the cards. Residents are likely to be given the option to leave, however.

Mr Osborne thanked the organisers of a sell-out benefit concert at London's Royal Albert Hall, adding: "We are looking forward to a good new Montserrat."

The Department For International Development has committed £37 million to the island since last August, including £6.5 million to help build emergency shelters for the homeless and a £450,000 grant for emergency repair work on a temporary hospital.