17:37 14 October 2015
Based on the internal Treasury report, legalising cannabis will lead to notable tax revenue for the government and enormous savings to the criminal justice system.
MPs have debated the issue on Monday although ministers do not have any immediate plan of altering the law despite a petition calling for legalisation drew more than 220,000 signatures.
Liberal Democrat health spokesman Norman Lamb said that legalising cannabis makes sense.
He said: "The whole debate has shifted dramatically now... as we see state after state starting this debate, with many states in the US deciding to establish legalised regulated markets.
"And of course the basic principle it seems to me is, do you put a potentially dangerous product into the hands of criminals who have no interest in your welfare at all or do you seek to regulate it?
"And I think in terms of public health protection of individuals and avoiding the ludicrous criminalisation of so many young people, a legalised regulated market makes a lot of sense."
But the Home Office said in a statement: "The government has no plans to legalise or decriminalise cannabis.
"There is clear scientific and medical evidence that cannabis is a harmful drug which can damage people's mental and physical health, and harms individuals and communities."