There are still "a few final important issues" to resolve before the long-awaited rebuild of New Street station can be approved, the Government has revealed.

In the latest update on plans to improve Birmingham's main station, Transport Minister Tom Harris said the city council had more work to do to ensure its proposals were "robust".

But he insisted that the Government had accepted the need to improve the station, and "great progress" had been made in developing a scheme which would be acceptable to Ministers.

He pointed out that the City Council and Advantage West Midlands, the regional development agency, were asking for £260 million from the Government to pay for the scheme, on top of the £128 million which had already been promised.

The comments were made in response to questioning by Theresa Villiers, the Conservative Shadow Transport spokeswoman, who asked for the dates the upgrade work was due to start and when it would be completed.

However, Mr Harris said this was something the Council and Network Rail, which is responsible for rail infrastructure, would have to decide - once the funding had been agreed.

Liam Byrne, the Minister for the West Midlands, said final approval was likely to come by the end of April.

But he revealed a final stumbling block had been a failure to agree which of the scheme's partners would pay additional costs if it ran over budget.

The New Street revamp will transform the dark and crowded 1960s station into a bright, modern 21st century transport hub for Birmingham and the West Midlands.

The project will double passenger capacity of the station and redevelop the area.

Mr Harris said: "£128 million of funding has already been committed to New Street in the recent White Paper. The city council has bid for up to a further £160 million from the Department, through the regional funding allocation.

"A separate bid for £100 million has been made by Advantage West Midlands to the Department for Business Enterprise and Regulatory Reform. There is also a package of funding from the City Council and from the private sector. The council's proposals for private sector funding are commercially confidential."

He added: "There is a clear case for improvements to New Street. The council and its partners have made great progress.

"They know that there are a few final important issues that they must resolve to ensure that plans for the funding and delivery stage are robust, given the significant amount of public funding requested."

However, he was unable to reveal when the rebuilding work was likely to begin.

"The precise timing of contracts for construction is a matter for the council and for Network Rail once funding is in place.

"Their plans are for design to begin in early 2008, for construction to begin in early 2009 and be fully completed by 2014.

"Everyone is working very hard, both within the region and within Government to ensure that decisions can be made as soon as possible." n Hundreds of rail guards and drivers at First Great Western, which operates services in Hereford and Worcestershire, are to stage a 48-hour strike on January 20.

The strike by the RMT union follows a vote by workers amid claims that managers are being used to drive and guard trains.