People will find it a bit odd that at a time when football has never been richer that it cannot secure the financial support for this project

Downing Street spokesman

Downing Street sought to blame the FA for the project's failure as a ministerial team led by Home Secretary Jack Straw began looking for an outside group to salvage it.

But speculation grew that the English national stadium could end up outside London - Birmingham City Council said it planned to talk to the FA about an alternative site in the Midlands.

Humiliating

Shadow culture secretary Peter Ainsworth told the BBC that Mr Smith had mishandled the project and said it was "humiliating" that Britain seemed unable to build a national stadium.

"I just think it's tragic that we've ended up yet again with a major national project which has come to nothing.

"I think the best thing the government's done so far is moving Chris Smith off the job and replacing him with Jack Straw."

Mr Ainsworth blamed a failure of public policy and political leadership and Mr Smith's decision to reject the original designs.

Ainsworth: Culture Secretary should resign

The culture secretary stressed the government could not bail out the FA.

"We do however want to try and help everyone to solve this problem and emerge at the end of the day with a really good national stadium."

Asked if the involvement of Mr Straw's committee was a personal 'slap in the face', Mr Smith replied: "No, not at all. It's an existing ministerial committee, it seemed the obvious place to ask for some work to be done from.

The proposals were rapidly heading towards football's answer to the Millennium Dome

Bob Russell MP, Liberal Democrat

"I'm working very closely with Jack Straw on that committee and we'll work together on this."

Mr Smith said there can be no "blank cheques" but did not rule out extra public finance for the stadium "if the project is right".

He referred to the success of the �120m Millennium Stadium in Cardiff "which I had a hand in producing as chair of the Millennium Commission".

Downing Street blamed the FA for the collapse, a spokesman saying: "People will find it a bit odd that at a time when football has never been richer that it cannot secure the financial support for this project."

'Nonsensical proposals'

Lib Dem sports spokesman Bob Russell said: "The proposals were rapidly heading towards football's answer to the Millennium Dome.

"It is of no surprise that city investors did not want to foot the bill for such nonsensical proposals."

He called for a scheme which had proper road, rail and air access, as well as incorporating athletics.

London Mayor Ken Livingstone also weighed into the row.

He accused the FA of failing to put English football and its fans first.

"I believe the FA are not being realistic and support the government's decision not to bail them out."

He pressed the association to "stand on their own two feet and invest in the stadium".

Brent Council, whose area includes the Wembley site, refused to "let the new Wembley stadium dream die".

Council leader Ann John said the authority had already started building the infrastructure for the scheme.

The Conservatives were due to force a government statement on Wembley in the House of Commons on Wednesday.