The Archbishop of Canterbury Dr Rowan Williams has praised British Prime Minister Tony Blair for defending religious values and differences during his time in office.

Blair announced yesterday that he will leave office on 27 June after 10 turbulent years in power.

Dr Williams paid tribute to Blair's commitment to religious freedom: "Tony Blair has understood as well as any Prime Minister in recent times why religion matters, how faith communities contribute to the common good and why religious extremism should have no place in a progressive society.

"As a man of genuine personal faith, he has not shied away from the risk associated with confronting extremism, while respecting difference."

Religion and Blair have been a source of debate throughout his 10 years in power with the rise of Islamist extremism and the challenge of integrating Britain's Muslim minority.

Blair is a member of the Church of England who at times has admitted to being guided by his Christian faith in political decision making, while at other times stressed that politics and religion should be kept separate.

Dr Williams praised Blair, however, for protecting religious diversity and safeguarding the right to debate, particularly over the contentious Iraq war, regarded by many as a blight on Blair's legacy.

"The Church of England, in common with all people of faith, is grateful that over the past ten years the Prime Minister has refused the demands of some to close down the space in our society within which both vigorous debate and the full diversity of religious conviction can find voice and be expressed," he said.

A Church of England report recently criticised Blair's decision to go to war with Iraq, while Dr Williams said last month that Blair should have prayed with US President George W Bush before deciding on whether to enter into the war, saying that both leaders might have received a different answer from God than the one they wanted to hear.

Dr Williams said yesterday in his tribute to Blair, "There have naturally been differences of vision and judgement between the Prime Minister and the Church of England, not least over the Iraq war, but he has been consistently willing to allow these disagreements to be voiced and discussed openly."

The Archbishop of York, Dr John Sentamu, issued a similar statement on Thursday in which he criticised Blair's decision over Iraq but commended him for keeping a space for disagreement.

"I fundamentally disagreed with Tony Blair over the invasion of Iraq - which I saw as a breach of international law - but disagreement is part of the free and fair society which he has endeavoured to uphold during his time in office," said Dr Sentamu.

Both Archbishops praised Blair for his role in bringing about the peace settlement in Northern Ireland, Archbishop Sentamu calling it one of the "remarkable things Tony Blair has achieved in office".