The rail regulator cancelled 19 schemes to remove pinch points on overcrowded lines yesterday after the Government ordered a cut in public funding for the railways.

Network Rail had proposed the schemes to increase capacity and to reduce delays on routes that have experienced record growth in passenger numbers. The Government has imposed a strict cap on the expansion of the network, however, to save about £1.5 billion a year.

Some of the 19 projects involved reversing cuts made by British Rail in the 1960s, when the railways appeared to be in terminal decline because of the rise in car ownership. Since the mid1990s the number of rail journeys has grown by 50 per cent and income from passengers has doubled.

Network Rail argued that the projects, which would have cost £350 million, were necessary not only to cater for future growth but to relieve already overcrowded services.

The cancellation that caused the greatest outcry among passenger groups was the plan to restore the second track on a 12-mile section between Swindon and Kemble in Gloucestershire. It is the only diversionary route between South Wales and London when the Severn Tunnel is closed.

British Rail ripped up one track in 1968 to save money on maintenance. Trains are forced to wait for services coming in the opposite direction, resulting in delays and restricting capacity on a line on which there has been rapid growth in long-distance commuting.

The track bed and double-width bridges and tunnel remain, making the reconversion to twin tracks a relatively simple task. However, the Office of Rail Regulation (ORR) has refused to grant the £32 million needed for the scheme.

Other cancelled schemes include removing pinch points in West Croydon, from Didcot to Oxford, Crewe, Redhill, Birmingham, Liverpool, Buxton, Bolton and Hertford.

Bill Emery, the chief executive of the ORR, said that he did not have the power to challenge the Government’s cap on expansion despite receiving several representations saying that it would worsen overcrowding.

The Government said that it would fund Network Rail to expand capacity by up to 22.5 per cent by 2014. Passenger numbers are currently growing at about 7 per cent a year. At that rate passenger growth will be double what the Government plans to accommodate, meaning that thousands more people will have to stand on trains each day for up to an hour.

Mr Emery said: “We don’t have the power to say, ‘That’s not enough capacity’. We have already drawn attention to the forecasts of high demand and it appears that passenger growth is holding up.”

He said there was also a possibility that the Government would not deliver all of the 1,300 carriages it had promised by the 2014 deadline. The ORR has approved the extension of 500 platforms to accommodate trains that are up to 12 carriages long.

The ORR approved £26.7 billion of funding for Network Rail from 2009 to 2014, £2.4 billion less than the company said it needed. There was no money for electrification of lines up to 2014 despite the claim by the Government this week that it wanted to convert lines from diesel to electric power.

The ORR set Network Rail punctuality targets for 2014 of 93 per cent for local services in southern England and 92 per cent for other services.

Gerry Doherty, leader of the TSSA railway union, said: “Improving punctuality targets is important but it will be meaningless if NR [Network Rail] merely timetables longer journey times as it has done in the past to meet those targets. Trains running ten minutes late are already said to be on time.”

Mike Greedy, of the railway watchdog Passenger Focus, said that the cancellation of the Swindon-to-Kemble project was disappointing: “There would have been a definite benefit to passengers, especially in improving reliability.”

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