The Prime Minister is to have his own US Air Force One-style plane for official visits around the world.
An RAF aircraft will be converted to carry David Cameron and other senior ministers at a cost of £10m.
The Government says having a dedicated plane will save the taxpayer £775,000 a year in commercial charter charges. It will also be available for the Royal Family to use.
However, Downing Street has yet to provide annual running costs for the aircraft and said details would be given in the Strategic Defence and Security Review next week.
Downing Street said the plane, which is expected to be in service for 20 years, will have 160 seats, of which 58 will be lie-flat business class.
It will also have a secure communications system and be repainted with Government branding.
But the move has attracted some criticism coming ahead of next week's spending review in which the Chancellor is expected to disclose further spending cuts.
Tony Blair was widely derided for his plans for a prime ministerial plane , instantly dubbed Blair Force One, and criticised by the Conservatives and Lib Dems over the cost.
Mr Blair planned two planes, a 17-seater for short trips and a 70-seater for longer flights, at an annual cost of £12.3m after a 2006 independent review by government spending adviser Sir Peter Gershon suggested it would be more cost effective and safer.
Gordon Brown scrapped the proposals when he took office.
Downing Street spends £6,700 per flying hour on the Prime Minister's travel, but it is expected to come down to £2,000 under the new arrangements.
No 10 had to pay £100,000 to hire an aircraft at short notice to take Mr Cameron and members of the Royal Family to the funeral of King Abdullah of Saudi Arabia earlier this year.
The A330 Voyager is an air-to-air refuelling aircraft, which is based on the Airbus A330-200 passenger plane, and is the largest plane the RAF has ever had, with the capacity for 291 passengers.
A Government spokesman said: "As part of the Government's defence review, we have been looking at ways to make better use of the RAF fleet to transport senior ministers and consequently deliver savings for taxpayers.
"We have decided to adapt one of our existing Voyager aircraft so that, in addition to its primary air tanking role, it can transport ministers and it will also be available for the Royal Family to use."
:: A330 Voyager
Overall length: 58.82m • 193ft
Wingspan: 60.3m • 198ft
Height: 17.3m • 57ft
Engines: Two Rolls-Royce Trent 772B Turbofans
Maximum speed: 493 knots • Mach 0.86
Maximum range: 4,500nm • 5,200 miles •
Maximum altitude: 41,000ft • 7.8miles • 12.5 km
Passenger capacity: 291