Washington is to spend almost £200m to turn one of its British military bases – already implicated in mass surveillance and drone strikes – into one of its largest intelligence hubs outside the mainland United States.

RAF Croughton, a US Air Force (USAF) base near Milton Keynes, which has a direct cable link to Government Communications Headquarters (GCHQ) at Cheltenham, is to be the site for an ultra-secure intelligence centre staffed by up to 1,250 personnel and covering operations in Africa, a current focus for US counterterrorism activities.

The $317m (£189m) project, which includes an installation for the Defense Intelligence Agency, the Pentagon's main military espionage service, underlines RAF Croughton's position as a centre for clandestine and classified US communications in Britain.

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Once complete in 2017, the facility will be comparable in number of personnel and operational importance to RAF Menwith Hill, the National Security Agency (NSA) listening station in North Yorkshire. Like Menwith Hill, it is likely to be co-staffed with representatives of British intelligence, including GCHQ.

The Independent, the sister title of The Independent on Sunday, revealed last year that RAF Croughton was used to funnel back to Washington data from a global network of spy bases inside US embassies, including the secret Berlin facility alleged to have been used by the NSA to listen in on the mobile phone of the German Chancellor, Angela Merkel.

The British base, which currently serves as a relay station for CIA agent communications, is also at the centre of claims that it is used as a support site for US drone strikes operated from Camp Lemonnier in Djibouti against al-Qa'ida targets inside Yemen.

Campaigners and senior politicians yesterday said the massive investment in RAF Croughton raised fresh questions about the oversight of US bases in Britain, which are governed by a 1950s agreement with Washington drawn up in a different age of surveillance technologies.

Labour MP Tom Watson, a former defence minister, said: "The new spend of $317m on facilities at RAF Croughton is a shocking revelation. There can be no doubt now that communications activities there must be thoroughly reviewed, and arrangements governing use of the base updated."

Details of the RAF Croughton project obtained by this newspaper show that the upgrade will involve the "consolidation" of six existing US intelligence groups, currently based at RAF Molesworth in Cambridgeshire, into a single facility at RAF Croughton.

The Pentagon said the project was required to move intelligence staff out of outmoded and unsuitable accommodation at Molesworth, saving at least $75m a year. The move will lead to "divestiture", or closure, of the Cambridgeshire base and its neighbour RAF Alconbury, which are estimated to contribute £40m a year to the local economy.

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The result will be a substantial further concentration of US intelligence firepower at RAF Croughton, whose stated purpose is to provide "world-class combat support" for activities including "global strike operations" and has recently had its security arrangements tightened.

A USAF briefing document makes it clear that the facility at RAF Croughton will be at the front line of intelligence activities and will include personnel from unnamed British agencies. The facility will be the principle intelligence centre for the USafricom – or Africa command.

It emerged last year that British Telecom provided a high-speed fibre-optic line between RAF Croughton and Camp Lemonnier, the counterterrorism operations base used for drone strikes in Yemen and the Horn of Africa.

The existence of the communications link has caused concern that RAF Croughton is used to relay command and control data from drone operators, possibly based in the US, to Djibouti. The Ministry of Defence (MoD) has stated that US personnel at the base "neither fly nor control any manned or remotely piloted aircraft anywhere in the world".

Lindis Percy, co-ordinator of the Campaign for the Accountability of American Airbases, said: "This massive new development at Croughton is clearly of great importance to the American military and government, but what say has the British Parliament or the Ministry of Defence had? It is high time that the issue of what goes on on US bases is debated in Parliament so there is a meaningful and credible debate and oversight on behalf of the British people."

The MoD yesterday insisted that all activities on US bases were subject to British approval. A spokesman said: "There are no circumstances under which UK military assets, including those bases made available to the US, could be used operationally by the US without the agreement of Her Majesty's Government."