The BBC has reported that the decision is to be announced in a statement to the Commons shortly after MPs return from next week's half-term break.

Whitehall insiders dubbed the controversial gambling venue “dead in the water” when Gordon Brown announced a review after becoming Prime Minister last year.

However it is thought that 16 large-scale but smaller casinos elsewhere will still be built.

Manchester was chosen as the surprise location of Britain's first Las Vegas-style super-casino, in January 2007, beating  Blackpool which was the favourite. 

The supercasino was expected to bring much needed regeneration to a run down area of the city.

Based at Sportcity in the Beswick area, close to the City of Manchester Stadium in the east of the city, the site was also planned to contain an entertainment complex with a range of facilities such as a multi-purpose arena, a swimming pool, an urban sports venue, restaurants, bars, a nightclub and a hotel.

However the Department for Culture Media and Sport insisted yesterday that no final decision has been made.