Problems with the rails have lead to delays

It will not start running until late March or April 2004 because the tracks need adjusting so trams can go round corners properly.

There are also problems installing power cables.

Managers said they had tried hard to get the system ready for Christmas but making sure the trams were reliable would take longer than hoped.

Mike Casebourne, the project director of Arrow Light Rail, explained the work is taking longer than expected.

He said: "Our optimistic views have not proved right in the long term.

"We were trying hard to get it open for Christmas but we have realised we are not able to do that."

The first delays were announced in July and were caused by "construction problems".