This year will see the scheme's first phase with the transport "smartcard" will be rolled out on the buses.

By 2010 smartcards should also be in use on trains. It is expected to take two years to install the necessary equipment onto every bus and train.

The card, which must be kept topped up with credit, is similar to the Oyster card already used in London.

It is hoped the smartcard scheme will encourage more people to use public transport instead of driving in the West Midlands.

Geoff Inskip from Centro said: "Ticketing is a barrier to people using the system.

I think once we actually deliver (smartcards) in the West Midlands people will love it."

He said it would take about 12 months to put new ticket machines on about 3,000 buses across the region.