£400m fund to launch a Labour fightback on railways

A fund worth £400m to alleviate short-term disruption for rail passengers will be announced today as part of a blueprint to revive the network.

But Tony Blair admitted yesterday that years might be needed to restore standards of service to the level provided by the much-derided British Rail before the industry was privatised in 1995. "With the investment and the change going in it will get better but it will take time to do so," he said.

Today, Mr Blair will meet Richard Bowker, the new chairman of the Strategic Rail Authority (SRA). Mr Bowker will then unveil a £33.5bn "battle plan" of short, medium and long-term improvements over the next 10 years.

Among its main provisions will be: to set out a firm timetable for line upgrades, including construction of new lines such as the Channel Tunnel link; to add new peak-time services; to provide 1,700 new train carriages; and to bring in a safer signalling system. Some £350m will be spent on modernising stations by 2004, including provision of better security, greater disabled access and improved passenger information systems.

The Government admits the money being allocated today has been announced previously. But it is trumpeting a £400m performance fund which, from April, will allow train companies and the successor to Railtrack to make short-term repairs to patch up the network and limit delays until large-scale projects come on stream in later years.

"Short-term problems can snarl the system up. This will make a difference," one rail industry source said last night.

Another £400m has been allocated specifically for local works drawn up in consultation with passenger groups, including mothballed stations being reopened.

In addition, the SRA will receive the funds to set up a "skills academy" to improve training and combat staff shortages as well as fund measures to attract more high-calibre workers.

Stephen Byers, the embattled Secretary of State for Transport, will make a Commons statement this afternoon. He will seek to use the plan as a device to regain public confidence in the Government's handling of the problems on the railways.

Yesterday, Mr Blair pledged his full support for Mr Byers. Asked on the BBC's Breakfast with Frost if he had 100 per cent faith in Mr Byers, the Prime Minister said: "Of course. If he didn't have my confidence he wouldn't be doing the job... Some of the attacks of Steve Byers in the past few weeks have been extremely unfair. The idea he's responsible for the rail strikes is particularly unfair."

Mr Blair said that Mr Byers was right to put Railtrack into administration and admitted that the Government did not address the problems facing the rail industry when it came to power in 1997. "Hindsight's a wonderful thing. But we didn't is the truth," he said.

Theresa May, the shadow Transport Secretary, said: "The Government seems to think it can buy off passengers by spending money on painting stations. This shows how completely out of touch the Government is. What passengers want are trains that run on time."

* Railtrack is "wasting'' tens of millions of pounds of taxpayers' money on relocating up to 1,000 signals on the west coast main line, say senior engineers. Instead of using a simpler technique for warning drivers of signals ahead, the company is moving the lights en masse.