By Jonathan Amos
Science correspondent, BBC News
Having a national agency will not change the relationship with Esa
Britain is to set up a dedicated agency to direct its space policy.
The new organisation is expected to have a budget and will represent the UK in all its dealings with international partners.
The announcement, made by the Science Minister Lord Drayson, follows a 12-week consultation held with academia, industry and government departments.
Britain spends about £270m a year on space, most of it via its membership of the European Space Agency (Esa).
But it also has a highly successful industry which currently contributes some £6.5bn a year to the UK economy.
"We have a real success story in our space research and space industry, and we need to make sure we make the most of it," Lord Drayson told BBC News.
"Having a central agency allows us to much more effectively develop the policy that will build on this fantastic asset.
"People will notice a much higher profile for space. It follows things that have happened this year, such as the appointment of the first British astronaut, the launches we have seen [of the Herschel and Planck telescopes]; and it will enable us to speed up great ideas like for example Virgin Galactic looking to put a launch site here in Britain."
A competition will be held to come up with a name and a logo for the new agency.
Whereas Germany, France and Italy have national space agencies that speak with single voices backed up by single budgets, the UK's approach has been to devolve space policy decisions to a club of "users" facilitated by a civil service unit called the British National Space Centre (BNSC).
These users are the government departments and research councils that have interests in space science or space-borne services.
The arrangement was supposed to ensure that limited space funding chased "need" and "value". But critics complained the approach only promoted self-interest and made it hard for the UK to adopt coherent positions on big international programmes - where much space activity is now directed.
The hope is that a more top-down structure can overcome some of the perceived weaknesses of the past, and drive more and better co-operation among the different space-user groups.
The UK acquired its first Esa astronaut - Tim Peake - this year
However, it is not completely clear yet how the agency will be funded.
The BBC understands there are at least two models on the table. One would see the public monies currently allocated to users being issued to the agency instead. Another would see the monies remain with the users who would then "subscribe" to programmes directed by the agency.
The latter model is how the European Space Agency works, although it also has a core budget of its own.
If the agency does take control of most of the civil space budget, it could lead to tensions if some users feel their priorities are being ignored by the new executive decision-making process.
But Professor Keith Mason, who heads the Science and Technology Facilities Council which is one of the key BNSC partners today, said this was not an inevitable outcome of the reorganisation.
"I think it's important when designing how this agency will work that we take the strengths from the current system and build on them," he said.
"The space science programme I'm responsible for has been hugely successful, and we need to make sure it stays that way. But we can do that; it is something we can design into this agency from the outset."
The space sector is a major employer and revenue earner
Richard Peckham, the chairman of UK Space, an umbrella group representing the British industrial space sector, commented: "In principle, having an agency is excellent news. Whether it is a success or not will depend on the implementation.
"Just calling it an agency is not enough; it has to be empowered at the right level. It also needs a policy - a clear vision of what it is that needs to be delivered; and we haven't had that to date," he told BBC News.
The announcement of an agency is just the latest in a series of initiatives affecting British space interests.
In July, Esa finally opened a technical centre in Britain - the only one of its major members not to have such a showcase facility. It also appointed a British national, Major Tim Peake, to its astronaut corps in May.
The government has initiated a review of UK space activity to try to identify the key trends that businesses can exploit in the coming years. This is due to report in the coming weeks.
Another space study was published on Thursday. The Space Exploration Review examines the options for future UK participation in the global effort to push humans out across the Solar System, especially at locations such as the Moon and Mars.
It identifies the technological and economic opportunities that the UK could exploit and that fit with its particular areas of expertise, for example in robotics.