GCHQ has not been using a controversial US internet monitoring programme to dodge tough legal checks on their activities, William Hague insisted on Sunday.
The Foreign Secretary refused to confirm or deny details of the eavesdropping agency's links to the Prism spy scheme, but said the law-abiding British public had "nothing to fear" from their work.
Speaking on the BBC's Andrew Marr Show, he also confirmed he would be making a statement to the Commons on the issue tomorrow.
Hague said: "As someone who knows GCHQ very well... the idea that in GCHQ people are sitting working out how to circumvent a UK law with another agency in another country is fanciful. It is nonsense."
The Cabinet minister declined to confirm that he had personally authorised engagement with the US Prism programme.
But he said checks in place in this country, including reviews of decisions by the Interception Commissioner, were strong.
"That legal framework is strong, that ministerial oversight is strong," he said.
"The net effect is that if you are a law abiding citizen of this country going about your business and personal life you have nothing to fear about the British state or intelligence agencies listening to the content of your phone calls or anything like that.
"Indeed you will never be aware of all the things that these agencies are doing to stop your identity being stolen or to stop a terrorist blowing you up tomorrow."
Hague said it would "defeat the object" to reveal how GCHQ or the security services work, because it would help terrorist networks, criminal networks, and foreign intelligence agencies.
"If actually we could tell the whole world, or the whole country how we do this business I think people would be enormously reassured by it and they would see that the law abiding citizen has nothing to be worried about," he said.
"But if we did that it would defeat the object. This is secret work... it is secret for a reason."
The existence of the Prism system was disclosed in reports by The Guardian and The Washington Post.
It is said to give America's National Security Agency (NSA) and the FBI easy access to the systems of nine of the world's top internet companies, including Google, Facebook, Microsoft, Apple, Yahoo and Skype.
It was reportedly established in 2007 under changes to US surveillance laws passed under president George Bush and renewed last year under Barack Obama in order to provide in depth surveillance on live communications and stored information on foreigners overseas.
The row crossed the Atlantic after The Guardian said it had seen documents showing that GCHQ had access to the Prism system since at least June 2010.
The British agency, based at Cheltenham, was said to have generated 197 intelligence reports through the system in the 12 months to May 2012 - a 137% increase on the previous year.
According to the newspaper, the Prism programme appeared to allow GCHQ to circumvent the formal legal process required to obtain personal material, such as emails, photographs and videos, from internet companies based outside the UK.
GCHQ refused to comment directly on the report, but in a statement it insisted that it operated within a "strict legal and policy framework".
Speaking on Sky News' Murnaghan programme, Business Secretary Vince Cable said it was a possibility that the Prism system may have allowed the Government to operate a covert sort of snoopers' charter, which the Liberal Democrats oppose.
"Well, it may well have been," he said, when asked if the allegations amounted to eavesdropping by any other name, and added that there were two key issues that the Tories would need to address.
"One is that the Americans have developed this very sophisticated Prism system, which enables them to get access to data in other countries, with or without our knowledge. And there is a separate issue about whether GCHQ were involved in some collaborative exercise," Cable said.
"I think a lot of people will be reassured that we do work well with the Americans, but the whole point about surveillance is you have got to have it when you're dealing with terrorism or other crimes."
However, he added that all surveillance had to be "proportionate", with "some oversight, legal and political".
The Lib Dems have so far resisted plans to forge ahead with the Communications Data Bill, also known as the snoopers' charter, which would give powers to track people's telephone and internet use.
Mr Hague is expected to make a Commons statement on the subject on Monday.Suggest a correction