Britain is set to link full UK passports and UK residency rights to the abolition of hanging and birching in Bermuda, according to UK sources.

And if Bermuda digs its heels in over the issue, the offer could be thrown into jeopardy.

Premier Pamela Gordon said yesterday: "I would be extremely disappointed if it was a quid pro quo situation.'' Ms Gordon pointed out that when Foreign Secretary Robin Cook announced the new deal for the colonies in February this year, he insisted there would be no "carrot and stick approach''.

She added: "If your sources are right, that really is a disappointing revelation because it means the word of the the Foreign Secretary has been called into question.'' And Ms Gordon said the people of Bermuda would have to be consulted before any changes to the law on the death penalty were made.

She added that if -- like the referendum held several years ago which backed retention of hanging -- the Island wanted to keep the death penalty, it could cause problems.

"For it to be taken off the books permanently and for it to be done as a result of a quid pro quo rather than the people of this Country deciding gives me some discomfort,' she said.

And she did not rule out a fresh referendum on the subject or "depending on timing'' for the issue to be raised as part of a General Election ballot if possible.

A UK Parliament insider confirmed: "Citizenship and human rights were linked and that will be part of the package coming in the White Paper.'' Also included as part of the citizenship package deal are limits on borrowing and tougher laws on international white-collar crime like tax evasion and money-laundering.

Bermuda is likely to escape problems with public sector borrowing and regulation of the financial sector.

But hanging -- although not carried out since 1977 -- and birching, also disused, remain on the Island's law books.

The UK source, however, confirmed reciprocal rights of residence in the Territories for British nationals will not be on the table.

Britain -- which for all practical purposes ended capital punishment in the 1960s -- has signed an international agreement aiming at universal abolition of the death penalty.

The source said: "It's been difficult for the UK to have formal responsibility in international meetings for Overseas Territories with capital punishment.

"The package finally put together will probably be a major step forward, with citizenship the main benefit for the Dependent Territories.

"The indications are that that the package is likely to meet the great majority of the understandable concerns of the Overseas Territories.'' Ms Gordon said: "I don't mind amending any law if it is driven by the population.

"I do have difficulty with a Government which indicates the conditions of citizenship would not be conditional on something else then changes in mid-stream.'' He said: "There are no final decisions, but considerable speculation. It will really be a package, but so far as citizenship is concerned, the UK will not insist on reciprocity.'' The British Parliamentarian added that citizenship issues had been "rankling and a concern'' since then-Prime Minister, Conservative Margaret Thatcher, slashed Dependent Territories rights in 1982 in a bid to dodge responsibility for millions of Hong Kong Chinese -- little more than a decade later handed back to China.

UK passports tied to capital punishment The news came as a new department in the Foreign Office -- dedicated to the now-renamed British Overseas Territories and under Junior Minister Baroness Symons -- this week started operations.

The long-awaited White Paper may still be tabled in the House of Commons before the end of the current Parliamentary session, likely to run into August.

But the UK source said the final polishing of the draft document may mean it will not come before British MPs before the new session, due to start in November.

Ms Gordon added that Britain had breached international human rights accords itself by depriving the Territories of full British standing in the 1980s.