The replacement of the Trident nuclear deterrent is expected to come a step closer on Tuesday when ministers announce the signing of multi-million contracts to design new submarines.

Reports suggest that the Ministry of Defence has placed £350m of work to design the new vessels, while British defence companies are also expected to be asked to begin work on their nuclear propulsion systems.

The MoD said that details of the contracts, including the companies, which have been asked to do the work, are expected to be announced in a written statement to Parliament tomorrow.

The announcement could cause tensions within the coalition Government. The coalition agreement stated that the Liberal Democrats would "make the case for alternatives" to full-scale replacement of the ageing Trident system, which would be scrutinised to ensure it represented value for money.

Conservatives are committed to a full renewal of the UK's fleet of four Vanguard-class submarines by 2028, but Lib Dem defence minister Nick Harvey has been conducting a review of possible cheaper alternatives.

The first of the four Vanguards had been due to leave service in 2022, but the Government extended the vessels' lives as part of the 2010 Defence and Security Review. Final decisions about ordering replacements do not have to be taken until 2016, after the next General Election.