The pregnant terrorism suspect, Roisin McAliskey, will be allowed to keep her baby with her in Holloway jail when it is born, the Prison Service decided yesterday following a recommendation by an expert panel.

Alan Walker, director of operations, took the decision after a review of medical reports by the panel of welfare and health representatives yesterday morning. "I have agreed with the views of the expert panel that it would be in the child's best interests for them both to be located in the mother-and- baby unit," he said.

The move will make Ms McAliskey, 25, who is seven months pregnant, the first Category A prisoner to have a baby in prison. It comes amid controversy over her four-month detention, without charge or conviction, while Germany seeks to extradite her in connection with the IRA mortar bomb attack on a British Army base in Osnabruck last summer. She denies involvement.

Following the recent reduction in Ms McAliskey's security categorisation from high-risk to standard-risk Category A, she will be able to attend ante- natal classes at the north London jail in the final weeks of her pregnancy.

The detention of Ms McAliskey, daughter of the former nationalist MP Bernadette McAliskey, has sparked a campaign for her to be granted bail because of her condition. Her lawyers will make a fresh bail application today.

Ms McAliskey will give birth in an outside hospital and will not be restrained while she is there. Her mother said she was delighted with the decision, adding: "Now we have ensured that mother and baby stay together, the next step is to ensure that mother and baby are together outside jail."