The UK will be home to driverless cars as early as next year as the government outlines measures to legalise them.

At the moment driverless cars, for the few that are made, are only allowed on private roads.

In December the Treasury said it would create a £10 million prize fund for a town of city that will become the testing area for the cars. The Department of Transport also promised these cars would be allowed on public roads by 2013. In reality this won't happen now until next year.

Despite research into driverless cars at Oxford University, restrictions on testing have slowed progress. George Osborne's goal to ensure "that the legislative and regulatory framework demonstrates to the world's car companies that the UK is the right place to develop and test driverless cars," was outlined back in 2013 and still hasn't had much changed.

The car industry has all but moved from the UK where it once flourished. Offering roads for driverless car testing may once again make the UK a world-leader for car development.

The US is leading the way with California, Florida and Nevada all getting involved with driverless cars. Google's driverless car has driven over 300,000 miles in California on the open road. Nissan has tested cars in Japan while Volvo aims to have 1,000 driverless cars on the road in Sweden by 2017.

Nick Connor, MD Volvo UK, said: "We warmly welcome this initiative from the government and will be looking into the detail with keen interest. We’re currently working with authorities in Sweden on a similar trial in Gothenburg for our DriveMe programme of self-driving cars. Support of national and local government is crucial if we are to demonstrate the real life-changing potential of this technology and encourage adoption from the public."

In May Google plans to manufacture 100 self-driving cars.

READ: Driverless cars to hit UK streets as new laws could soon make them legal