Rail and bus passengers in Oxfordshire are to get a boost from a new deal involving Richard Branson's much-criticised Virgin rail company.

The package includes no-quibble refunds for poor service and special bus travel offers for rail passengers.

Deputy Prime Minister John Prescott, who last week described Britain's privatised rail services as a national disgrace, welcomed the new deal.

He said: "It is an important step towards the kind of improvements I wish to see and it will provide long-suffering passengers with early and much-needed improvements."

The benefits include:

A £1 "add-on" return bus ticket which will allow rail passengers to travel anywhere within designated bus zones in Oxford, Banbury and 19 other towns and cities;

Existing bus services from Oxford via Bicester and Buckingham to Milton Keynes and Cambridge to Oxford to be integrated with rail services;

Evaluation of a possible bus-rail link between Abingdon and Oxford.

The new deal also includes refund vouchers for poor service on both Virgin routes on a no-quibble basis, regardless of who is at fault, with all season ticket-holders eligible for refunds. Refunds normally apply after delays of 60 minutes, but on services from London to the West Midlands, this will be reduced to 45 minutes.

They will also be available for 30-minute delays on all West Coast services when the line upgrading is completed. The amount refunded will be increased from 20 per cent to 25 per cent, and for delays of more than two hours the refund will be 100 per cent. The improvements were secured by rail franchise director John O'Brien in return for his approval of bus company Stagecoach's acquisition of a 49 per cent stake in the Virgin Rail Group.

Stagecoach runs the South West Trains route, while Virgin operates the West Coast and the extensive CrossCountry routes.

After Mr Prescott's criticism at the Labour Party conference last week, Mr Branson said the West Coast line had been the most neglected and run-down route in Britain but he intended to turn it into Europe's best within five years.

Mr Branson made a personal apology on radio and then had to apologise again for using an obscenity in describing his company's performance on the West Coast line.

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