OLYMPICS: England, Wales, Scotland and Northern Ireland should compete independently at the Olympic Games, rather than joining forces as Britain, according to a British government report examining how sport can be better run and funded to ensure greater success.

The report by the British government's strategy unit, which has been seen by the Guardian but is not due to be released until next month, suggests the complete devolution of funding for sport in Britain. Under the plan, the four home countries would compete independently at the Olympics and other major events.

According to sources close to the report, the government believes that by setting up four independent Olympic associations instead of one for the whole of Britain, funding for sport could be better targeted. In turn, this would increase the chances of the four home countries winning medals.

A source said: "The complete devolution of funding is something that the government is looking very closely at. The government wants to radically change the way sport is run and believes that by giving each of the home countries funding this would allow them to target the money more effectively."

The report was commissioned following concerns that the administration of British sport is bureaucratic and cumbersome, and that it is hampering both success on the field of play and attempts to secure major events such as the World Cup and Olympics.

The report raises serious questions about the staging of the big competitions, claiming that Britain has no strategic plan for bringing such events to the country. It adds that there are few economic benefits and that the "feelgood factor" depends on winning rather than staging events.

Britain is examining the feasibility of backing a bid to stage the 2012 Olympics.