England is set to follow Australia's lead and introduce plain packaging for cigarettes before the 2015 election.
The conservative government of David Cameron on Thursday announced a U-turn after controversially shelving the idea of banning branding in July.
At the time the opposition said the Tories had walked away from plain packaging after hiring Australian election strategist Lynton Crosby whose consultancy firm had previously worked for tobacco giant Philip Morris.
Mr Crosby denied having ever lobbied the prime minister "on the issue of tobacco or plain packaging of cigarettes".
UK Health Minister Jane Ellison on Thursday said the fact plain packaging was back on the agenda proved accusations levelled at the government were incorrect.
"To be honest all the people making wild speculation about the tobacco lobby look rather silly this morning because we were doing exactly what we said, which is keeping this policy under active consideration," Ms Ellison told Sky News.
The minister said when the government announced in July it wasn't proceeding "at that time" it made clear it would examine emerging evidence.
"That's exactly what we're going to be doing."
Distinguished paediatrician Sir Cyril Chantler will conduct a review of the evidence and report back to the government by March.
"We've asked for this review of the evidence both from Australia - and it's the anniversary of the Australian legislation this coming weekend - and other studies (that) have emerged in recent months," Ms Ellison said.
The Tories' change of mind comes after a cross-party group of peers tabled amendments in the House of Lords that would have allowed plain packaging.
The group was confident of winning the vote so the government has acted to avoid a likely upper house defeat.
The government will now pass enabling legislation so that after the review is received in March "we will be able to move swiftly", Ms Ellison said.
Former Liberal Democrat health minister Paul Burstow, who was in the job until late 2012, believes the government's mid-year wavering was down to Mr Crosby's influence.
"The reason this has been delayed so far has been the influence of the tobacco lobby and perhaps the influence of Lynton Crosby as well," he told Sky News.
Action on Smoking and Health chief executive Deborah Arnott argues Thursday's announcement is "a victory for public health, for common sense and for future generations who will as a result be protected from glitzy, colourful and misleading tobacco packaging".
"The government should be given due credit for being willing to listen to parliament and to the experts and change its mind," she said.
The Scottish government plans to introduce plain packaging in 2014-15 while the Republic of Ireland has already introduced legislation to follow Australia's lead.
Labour leader Ed Miliband used Thursday's news to renew his attack on Mr Crosby who is being paid $A853,000 to work full-time on the Tories' 2015 election campaign.
"The government should have legislated on plain packaging earlier this year and they didn't because they were pushed around by the tobacco lobby," the opposition leader said.
"Now they've changed their mind because they feared a parliamentary defeat.
"There are (still) real questions for Lynton Crosby and the government to answer about his role in relation to policy."
Mr Miliband said the government didn't need to wait for another review but should act immediately.
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