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His announcement follows a proposed amendment to the Queen's Speech calling for the government to ensure adequate funding to allow women from Northern Ireland to have abortions in England without being charged.
Mr Hammond said the issue of abortion was "a matter of great importance" and that the Minister for Women and Equalities would be making an announcement "by way of a letter to members of this House explaining that she intends to intervene to fund abortions in England for women arriving here from Northern Ireland".
He said he hoped the house would find it a "sensible way of dealing with this challenge".
Commons Speaker John Bercow confirmed he has selected the amendment to the government's legislative programme, meaning MPs will have a chance to vote on it at the conclusion of the Queen's Speech debate.
Earlier today, Northern Ireland's Appeal Court ruled that abortion reform should be left to the Stormont Assembly.
Overturning a lower court's ruling, it said the complex moral and religious questions behind the issue should be determined by a legislature rather than a court.