Security forces will not be able to intercept e-mails sent through 90 per cent of British ISPs when new internet monitoring laws are introduced, evolution has learnt.

A source close to Government revealed 'black boxes' designed to intercept e-mails will be installed in just ten per cent of ISPs as a result of the Regulation of Investigatory Powers (RIP) Bill.

It will be impossible to monitor e-mails and internet traffic at ISPs without black boxes.

The revelation will be an embarrassment to the Government which has faced criticism from civil rights and business groups.

It has argued efficient monitoring is important to make sure paedophiles and terrorists cannot use e-mail and the internet without fear of being found out.

When the bill was published, Home Secretary Jack Straw said: "We have to permit interception in closely-defined circumstances to protect national security and fight serious crime."

Last week, Lord Bassam of Brighton, who is steering the RIP Bill through the House of Lords, watched Peers dish out two defeats for the Government when they voted for amendments to the bill.

They decided the Home Secretary should commit more cash to help ISPs implement the laws.

He has promised £20 million but the Lords decided he should commit to a "fair" amount of money as many people in the industry predicted the cost will be far higher.