London’s £5.5bn Thameslink project is to get the go-ahead as well as major redevelopments at Birmingham New Street and Reading Stations after government approved the three schemes in a rail White Paper published today.

Transport secretary Ruth Kelly said the three schemes would eliminate the system’s biggest bottlenecks but made no mention of funding for Crossrail.

The long delayed north-south, cross-London Thameslink 2000 rail project will be delivered in two phases, with significant extra capacity by 2011 and the full scheme completed by 2015. It will use 12-carriage trains running 24 times an hour through central London and will expand its route to new stations outside the capital.

Network Rail is to receive a grant of £120m– the first of three tranches of funding required – to redevelop Birmingham New Street station with work expected to begin in 2009. It will also be given £425m for track and station works at Reading to ease a bottleneck that restricts capacity on several routes, including the Great Western Main Line.

The government also approved a further £200m to start work on a strategic freight network and set aside £150m to refurbish a further 150 stations.

Kelly said the paper - Delivering a Sustainable Railway - allowed for potential doubling in capacity over 30 years and would create a railway that would expand to carry at least 180 million more passengers. She said capacity would increase to cope with more than 20% growth in the next seven years, ‘on a network which will be even safer and more reliable’.

‘Passengers want not only more capacity and reliability on their trains but also more modern stations, simple and efficient ticketing, better quality of service and value for money. They're right to be so demanding and this strategy can deliver what they want,’ said Kelly.

‘Steady investment has given us a rail network which is in good shape for the first time in a generation and this means we can be ambitious for its future. It should be a railway which helps power economic growth and enhances the quality of our lives. We can't know precisely what our railway will look like in 30 years time but now we can be confident of making it bigger, stronger and more flexible.’

The government formally submitted its spending plans today for approval by the Office of Rail Regulation.