Plans for a Midland Metro tram line through Birmingham city centre moved a huge step closer to reality after council leaders and the passenger transport authority agreed to bury their differences and put the case for the #116 million scheme to the Government.

Centro-PTA will today formally agree to submit the business case for the track, from Snow Hill to Five Ways, to the Department for Transport.

Centro officials believe the line will have a major impact on Birmingham's heavily congested roads, as thousands of commuters and shoppers decide to leave their cars at home and use the tram instead. The first trams could begin to run in January 2012 along a route taking in Corporation Street, New Street Station, Broad Street and the ICC, if Government approval for the business plan is forthcoming.

Submission of the detailed financial case for the metro extension was delayed for several months while the council and Centro-PTA argued about the impact trams would have on cars and other vehicles using city centre roads. Centro-PTA said yesterday that, while outstanding issues needed to be resolved, the council was content that the business case should be submitted to the DfT.

The submission will also include plans for the Black Country metro extension, from Wednesbury to Brierley Hill via Dudley.

The two schemes together will cost #430 million to complete, with the Government expected to contribute #322 million. The remain ing costs are being met by local councils and the private sector.

Centro-PTA chairman Gary Clarke said the metro extensions would improve the environment in Birmingham city centre and provide high-quality public transport through both residential and commercial areas of the Black Country.

"It will give direct access for people to Wolverhampton, Birmingham and West Bromwich centres, as well as supporting the regeneration of significant areas along the route and development of Merry Hill and Brierley Hill," Coun Clarke added.

The business case shows the benefits of expanding the metro would far exceed the costs and would be good value in line with the latest DfT guidance, according to Centro-PTA.

Coun Clarke added: "The expanded Midland Metro network will provide an excellent level of service for passengers.

"Frequent high-capacity trams will provide a real boost to the accessibility of Birmingham city centre and the Black Country - with excellent links between shops, homes, offices, rail stations and major new developments. It will make a real impact on our campaign to cut congestion."

Birmingham City Council said while there are outstanding issues to be discussed by cabinet on June 1, these can be resolved.

Centro-PTA expect to receive conditional Government approval for the business case by October, enabling it to: tender for contracts to build the line, supply the trams and operate the network. Coun Clarke added: "Planning inspectors have already ruled overwhelmingly in favour at public inquiry and we have the backing of the business community and local councils."