A UNION leader said plans for a £7.5bn rail upgrade were a prime opportunity for the region’s businesses thrive, and all efforts should be made to ensure the project goes ahead.

After being postponed under the previous Government, the future of the Intercity Express Programme (IEP) was uncertain again after the new Government deferred a decision on the project until October at the earliest.

The IEP, first announced more than three years ago, would see 30-year-old trains used on the East Coast Main Line and the London to South Wales line replaced and capacity increased. About 1,300 trains were initially promised from 2012.

Work would be carried out by Agility Trains, owned by Hitachi, and it is understood that the majority of construction would be done in the UK, with sites in the North-East – particularly the former Tyne Marshalling Yards, in Lamesley, Gateshead – being among the frontrunners. Becoming the site of the train factory, or North-East firms winning work on the project, would lead to extensive job creation in the region, and was hailed as a prime opportunity for the regional economy to recover from recession.

But last night, after the new Government delivered its deferral on a decision, businesses, MPs and business organisations and lobbying groups were urged to do everything possible to ensure the IEP goes ahead.

Davey Hall, regional secretary of Britain’s biggest trade union Unite, urged action to ensure the project is not cancelled.

“If the Government gives the green light to the contract, the investment would put the UK back on the map as a significant train manufacturer for the European market,”

he said.

“This provides a prime opportunity to advance a combined and concerted effort from all concerned to ensure the contract comes to fruition and is placed in the North- East.

“Unite is calling upon employers, business groups and MPs to jointly campaign to ensure the Government endorses the contract without delay to support regional investment, jobs and the UK’s manufacturing base.”

IEP was postponed by then- Transport Secretary Lord Adonis in February, with him citing the credit crunch and lower-than-expected passenger numbers as the reason.

The Department for Transport (DfT) had promised at least 500 carriages, and possibly as many as 2,000, and trains that would boast electric doors and have up to 100 more seats.