Transport bosses will today announce a review of rail capacity in Birmingham amid concerns the £500 million New Street development will not cope with future rail demands.

Network Rail said it would assess rail growth and look at the future of the already burgeoning rail network to look at how it can meet capacity challenges.

The announcement came after concerns over New Street's capacity was raised by Virgin CrossCountry Trains.

Phil Bearpark, deputy managing director of the company, said a current nine per cent annual growth in passengers using his network would be halted by the current plans to redevelop the city's main rail hub.

The £500 million Gateway scheme has been backed by Network Rail, Birmingham City Council and Advantage West Midlands.

Network Rail said the project would represent a major investment in Birmingham's public transport network. But some critics have argued it has not gone far enough.

A spokesman for the groups said: "Addressing rail capacity in the West Midlands, today and for the future, is clearly important to the leaders and the people of the region. We already know that Birmingham New Street can cope with significant future growth through measures such as the lengthening of trains. However, a serious review of rail growth in the much longer term is the only way to establish the exact nature of the challenges that we face, and how these challenges can best be met."

Mr Bearpark said New Street was at capacity and he has been unable to introduce new services over fears the station will reach saturation point.