· Ministers to compel ISPs to take action on piracy · Crackdown follows calls from film and music firms

Internet users who illegally download music and films could lose their access to the web under legislation aimed at cracking down on those who flout piracy laws. Powers being drafted by the government will compel internet service providers to take action against customers who access pirated material.

The Department of Media, Culture and Sport will recommend the plan in a green paper on the creative industries to be published this month, a source with knowledge of the paper said. Under the new sanctions users will face a "three strikes" regime. A warning email will be sent for the first offence, followed by suspension from the service and finally termination of the internet contract.

A draft copy of the green paper said the government "will move to legislate to require internet service providers to take action on illegal file-sharing," although it has yet to decide if information on offenders should be shared between the ISPs, the Times reported.

The government has come under increasing pressure from the music and film industries to penalise users who download pirated files. Although piracy is illegal, prosecutions are rare.

The UK's four largest internet providers - BT, Tiscali, Orange and Virgin Media - are already in talks with studios on a joint voluntary agreement to share information on web violators.

But under the legislation they could be forced to cut off customers. ISPs which fail to enforce the rules could face prosecution, and suspected customers handed over to the courts.It remains unclear who would be responsible for arbitration in disputed allegations, for example when customers claim that other users have "piggy-backed" on their wireless internet access.

A spokesman for the Department of Media, Culture and Sport said: "There are still meetings going on and consultation to take place, so nothing is finalised. The strategy document is to be released within the next couple of weeks."

The green paper is also expected to call for a £200m national film centre, as well as 19 other schemes intended to turn Britain into the "world's creative hub". Other pledges include the launching of a global arts conference, dubbed the "World Creative Economy Forum" modelled on Davos, the creation of a new college of digital media and the protection of live music venues such as the Astoria and the Hammersmith Apollo in London.

The government is also expected to reveal plans for a new creative festivals season, a new film centre on London's South Bank and a permanent home for London fashion week.

Under plans to be announced by Gordon Brown and the culture secretary, Andy Burnham, children will be given the right to "five hours of culture a week" encouraging them to visit galleries and museums, attend the theatre, or study a musical instrument.

And some 1,000 creative apprenticeships for young people are also being proposed, which will be managed by a new Skills Academy.