Regional transport authorities will be invited to take over responsibility for rail services under new plans to be announced by Labour in Birmingham.
Authorities such as Centro, the West Midlands Passenger Transport Authority overseen by local councillors, would hand out franchises to rail operators – or to set up not-for-profit rail businesses.
The proposals will be published by Maria Eagle, Labour’s Shadow Transport Secretary, at the party’s policy forum taking place in the city over the weekend.
Party leader Ed Miliband is expected to speak at the event, which is part of a far-reaching policy review which will help determine the contents of Labour’s next general election manifesto.
Labour’s plans would strengthen the role of existing transport authorities, which are governed by councillors appointed by local authorities, in contrast to the Government’s approach of focusing on local enterprise partnerships, which involve chambers of commerce and other business leaders as well as councillors.
Ms Eagle will say that a Labour Government will move responsibility for regional and local rail services away from the Department for Transport and down to elected transport authorities working in partnership with each other.
They would be allowed to make decisions about rail franchises, or introduce alternative models including not for profit and mutual schemes.
They would also be helped to re-regulate bus services, using powers which already exist but are rarely used. In practice, this means transport authorities would have the power to set fares and determine bus routes, in the same way as the Mayor’s office does in London.
Transport authorities would also be allowed to develop not-for-profit rail businesses or municipal businesses run directly by local authorities.
And funding for major transport projects, such as road improvements, could also be devolved to transport authorities.
Ms Eagle said: “We need a new approach that enables people to have a real influence over the local transport services on which they depend.
“I want to see the rest of England benefit from London-style powers to manage bus and train services in the way that can make integrated transport a reality.
“It’s time that fares and services were agreed not with profits but with passengers in mind.
“A real commitment to devolving powers and funding over transport will require a cultural change away from the ‘Whitehall knows best’ approach.
“It will mean being willing to take on the vested interests in the private train and bus companies that benefit from the current system.
“Labour has listened to the call for more accountability over how decisions are taken over local transport fares and services.”