Alun Michael informed MPs of the consultation period

Hunts in upland areas, such as Eryri in Snowdonia, are hoping to escape any ban by arguing that their role is essential for pest control.

On Monday, the Commons vote for a ban on hunting raised hopes among Labour MPs that the government would make it illegal.

But the Lords voted for hunting to continue under licence on Tuesday.

Cardiff MP Mr Michael said he was hoping to resolve the issue by finding common ground between the two.

But he added the government could invoke the Parliament Act to push through legislation after the consultation period, even if the House of Lords tried to block it.

But this would delay any change in the law until 2004 at the earliest.

Possible reprieve

During his statement, Mr Michael did not produce detailed proposals, but he did set out "cruelty and utility" as guiding principles.

This could mean that hunting with dogs could continue where it was shown to be the most effective and humane method of pest control.

That meant hunting could go on in areas like the Welsh uplands and the Cumbrian fells where hunters often pursue the hounds on foot.

Hard-line opponents of hunting accept that such a formula, combined with a ban on hare coursing and stag hunting, may be acceptable to many Labour MPs who have so far voted consistently for an outright ban.

This may mean a reprieve for hunts like the Eryri in Snowdonia, which claims using dogs is the only effective solution to the problems caused by foxes attacking farm animals.

On Monday, Prime Minister Tony Blair was among a majority of 211 MPs who voted by 386 to 175 for a total ban.

Around three-quarters of the 40 MPs from Wales also supported an end to hunting with hounds.

But on Tuesday, the House of Lords voted by 366 to 59 in favour of a compromise deal, which will allow hunting to continue under license.