Skanska Construction, which is already involved in creating the Channel Tunnel fast link, has been selected as preferred bidder by the East-West Rail Consortium and GB Railways group.

The project is waiting for funds to be released by the Strategic Rail Authority but it could be up and running by 2006.

The Bedford-Sandy line, closed by Beeching in 1968, will need to be rebuilt and the Bicester-Bletchley line reopened to create a long-distance route from East Anglia to Oxford via Milton Keynes which will feed into seven other main lines.

"We are delighted that Skanska, with a strong portfolio of railway projects, has decided to join us in implementing this important scheme," said Laurence Collins, chair of the East-West Rail Consortium.

"East-West Rail will provide a much-needed link between some of England's fastest growing communities and our largest container port at Felixstowe, and will make a major contribution to the strategic rail network.

"The innovative public-private partnership model we will be using reflects and develops the new approaches advocated by the SRA in their recent Strategic Agenda."

Rail campaigners have fought for years for the idea. British Rail was poised to implement phase one of the project when it was shelved by preparations for privatisation.

Railfuture chairman Peter Lawrence said: "East-West rail is an important step in expanding the rail system for both passengers and freight."

Nick Dibben of Railfuture's East Anglia branch said: "The Government must learn to respond quickly to proposals such as this."

GB Railways group includes Anglia Railways, Hull Trains and GB Railfreight.

More information:

nick.dibben at railfuture.org.uk

www.eastwestrail.org

www.Skanska.co.uk

www.GBRailways.com