Mr Darling wants to streamline the rail network

The 25 existing rail franchises are to be reduced to 19 as part of efforts to "streamline" and improve the industry.

The Rail White Paper suggested the franchises change to align with Network Rail's regional and route structure.

The move was welcomed by Rail Passengers' Council director Anthony Smith, who said "bigger franchises can bring passenger benefits".

The changes, announced on Tuesday, mean fewer companies will be involved in running rail services over a larger area.

Mr Darling said invitations to tender for services will be issued in summer 2005.

The new franchises are:

• A new Greater Western franchise will be made up from three existing services - the First Great Western, First Great Western Link (Thames) and Wessex services.

• Greater Northern services will be merged with London's Thameslink.

• The Central franchise services will be split into Silverlink, Chiltern, Virgin CrossCountry, Midland Mainline and Northern franchises in 2006.

• A new franchise incorporating South West Trains and the Island line (the Isle of Wight line) - unless it is decided that the Island line would be better served by a community management.

George Muir, director general of the Association for Train Operating Companies, said Mr Darling's announcement provided clarity and it was important that the re-franchising continued "apace".

But Rail, Maritime and Transport union general secretary Bob Crow said franchises up for renewal should be brought back into the public sector.

'Kick in the teeth'

He said: "This does nothing to bring about a joined-up railway. Instead of having 25 franchises taking money out of the railways, we will have 19 and there will still be millions of taxpayers' money poured into shareholders' pockets."

The announcement came as the Strategic Rail Authority said it had signed a deal with Serco-NedRailways to run a major franchise across the North of England.

Some Labour MPs were angry at the decision following a vote at the Labour conference to bring the railways back under public control.