Terrorist suspects will be allowed to be held without charge for longer, the home secretary has announced.

David Blunkett is also set to unveil details of stiffer penalties for identity fraud as part of a bid to crack down on terrorists and racketeers.

The plans will form part of a series of amendments to the Criminal Justice Bill.

The time a person can be held without charge under the Terrorism Act will be increased from seven days to two weeks but in line with current practice the police will have to get a court order.

Using fake passports and driving licences will result in a two-year jail term if the home secretary's changes become law. Applying for a fake driving licence will lead to a £2500 fine.

Blunkett defended his radical overhaul of the current laws, saying the international nature of terrorism and the sophisticated methods terrorists use to hide their identity meant the changes were vital.

"It takes time to investigate members of loose-knit networks across international boundaries.

"To close in on terrorists, the police increasingly need to analyse complex material. In the course of an inquiry, they may need to examine computer hard disks, make multiple inquiries across different countries, or retrieve dangerous substances for forensic analysis," he said.

The home secretary warned that use of a fake driving licence had serious implications.

"Passport and driving licence fraud are gateway offences to organised crime and terrorism. Our legislation must keep pace with increasingly sophisticated criminals and complex crimes. The police must have the powers they need to do their job and protect the public," he said.