Government departments could face legal action unless they spend millions to rebuild hundreds of public sector websites in order to comply with anti-discrimination laws.

An internal investigation concluded 78 per cent of public sector websites, around 800, fail to meet standards required by the Disability Discrimination Act (DDA) 1995.p>Under the Act, organisations must make "reasonable efforts" to ensure that services can be used by disabled people.

Part III of the DDA, due to come into effect in October 2004, puts the "duty on service providers" to make this provision.

The internal report compiled by the Office of the e-Envoy based on the audit has expressed "concern" at the situation.

In a statement it said: "In February 2001 the e-minister announced that all new government websites should be accessible.

"In May 2002 Guidelines for UK Government Websites was published by the Office of the e-Envoy to offer guidance and best practice for website design.

"Although the Office of the e-Envoy is aware and concerned that many government websites need redesigning in order to make them more accessible, responsibility lies with individual departments."

Experts put the cost of upgrading at 10 to 15 per cent of original budgets, running into several millions of pounds.

Martin Greenwood, programme manager at local government IT group Socitm Insight, said: "It has not yet been tested in the UK courts, but all the advice is that we will be breaking the law if websites are not accessible.

"You only need a couple of high profile cases and it could cost a lot and could be politically embarrassing."

Greenwood pointed to a case in Australia in June 1999 when Bruce Maguire, a blind person, successfully complained to the Australian Human Rights & Equal Opportunities Commission (HREOC) under the Australian DDA.

He contended that the Sydney Organising Committee for the Olympic Games (SOCOG) had unlawfully discriminated against him as a blind person, because significant parts of its website were inaccessible to him.

The HREOC supported Maguire's complaint and ordered SOCOG to make its Olympics.com website more accessible.

SOCOG ignored the ruling and was forced to pay a fine of A$20,000 (£7,700). It claimed that adjusting the site would have cost about A$2.2m (£850,000).