Prime Minister Tony Blair, who is attending the European Union summit in Cologne, said the reports were "good news".

Defence Secretary George Robertson told the Ministry of Defence briefing the acceptance was a "hopeful sign" but was not enough on its own to halt Nato's bombing raids.

Robin Cook: "An encouraging step in the right direction"

And Foreign Secretary Robin Cook insisted Serb troops would have to withdraw from Kosovo before the bombings were halted.

"We can't let up this military pressure until we are sure President Milosevic is really serious," he said.

"We have had too many cases in the past of President Milosevic making an empty promise."

Robin Cook: Looking for deeds not words

"This time we don't just want fine words we want to see actions.

"In particular we want to see the Serb forces start to withdraw from Kosovo. That's the real test."

Mr Cook added that the deal taken to Belgrade by the EU envoy the Finnish President Martti Ahtisaari and the Russian envoy Viktor Chernomyrdin met all of Nato's "basic bottom lines".

Mr Ahtisaari will report back to the EU summit later on Thursday.

No compromise

Mr Blair insisted that Nato would not compromise on its stated demands: the withdrawal of Serb forces and introduction of an international military force to return the ethnic Albanian refugees home safely.

German police guard the EU summit venue

"If this news is correct and the Serb Parliament and the Serb regime are accepting our demands, then that's obviously progress and good news," he said.

"But let us be clear, the terms are not negotiable. They are as we have set them out throughout and they must be accepted in full.

"Let us hope that this is what is happening."

If the tentative peace settlement is approved by the EU leaders it would then go a meeting of the Group of Eight industrialised nations in Cologne in a fortnight's time.

But the final decision on ending the air strikes would probably rest with the full Nato alliance of 19 nations.

The RAF Harrier unit based at Gioia del Colle, southern Italy, is staying focused on its military objectives despite talk of peace, its commanding officer said.

Group Captain Andre Dezonie said: "The air crews are very determined to do the job that they have been given. They are obviously aware of events but they are concentrating on what they have got to do here and in the air.