Wales Business Stephen Farrell

Final tenders have been invited for the next Wales and Borders rail franchise, with the winner also set to run the new South Wales Metro.

The new agreement will run from October 2018 and will support the Welsh Government's ambition to run a new not-for-profit rail model similar to the way in which Transport for London manages public transport services.

Abellio Rail Cymru, Arriva Rail Wales, KeolisAmey and MTR Corporation (Cymru) Ltd have all been invited to submit final tenders. Arriva is the incumbent operator.

Proposals for the South Wales Metro are being developed alongside the Wales and Borders service with the aim of developing an integrated transport system in the region.

The Welsh Government has also made a series of commitments regarding the franchise, including the expectation that more staff will be employed on the service.

Economy secretary Ken Skates said: "Detailed discussions with all four of the shortlisted potential operators have only served to reinforce our optimism that the next service will see big improvements. I look forward to seeing how the detailed tenders tackle our ambitious requirements for the next 15 years before making a decision on the successful operator in early 2018."

The announcement has been made despite the ongoing discussions with the UK Government over devolving powers to decide who runs the service. The Welsh Government is seeking £1bn to fund the operation of the network.

Skates added: "There is will on both sides to ensure that the settlement works for Wales and the Border and, following positive talks, a resolution is near. It's great news for rail users across Wales that this ensures the services modern Wales expects and have been promised, will be fully delivered."