Network Rail has revealed the results of a detailed investigation into the need for new capacity on Britain's railway network. It concluded that a new 200mph high-speed line to the Midlands, the North West and Scotland was the best option. Construction costs would be £34bn and would  generating almost £55bn of value. The study concluded that in order to meet demand a new high-speed line from central London to central Manchester with a diverging high speed line to the centre of Birmingham offered the best benefits.

The line would serve Birmingham and Manchester, and would mean that passengers could travel from Glasgow to London in just two hours and 16 minutes.

It rejected several alternative routes, including the east of England.

The final decision rests with the government who have said assessments of the costs and environmental issues involved needed to be carried out before it could approve any plans. It is currently conducting its own rail network review and said it hoped to be in a position to make a decision next year.

If given the go-ahead, Network Rail said it would take up to five years to decide on the exact route and complete the planning stages and it would like the first section of the line between London and Birmingham to be completed by 2020. The line would become the country's second high-speed rail link after the line that runs from London St Pancras to the Channel Tunnel, run by the Eurostar service and connecting to high-speed lines in continental Europe.

Network Rail's proposed new line linking Glasgow and Edinburgh with London would see trains  travelling up to 200mph and would also serve Manchester, Liverpool, Preston and Birmingham.

This would lead to significant reductions in journey times. London and Birmingham would be cut from  one hour and 22 minutes to just 45 minutes

Network Rail’s study concluded that in order to meet demand a new high-speed line from central London to central Manchester (in just 1hr 06mins) with a diverging high speed line to the centre of Birmingham (just 46mins) offered the best benefits.

Continuing the high-speed line to Preston (1hr 13mins), with a diverging high-speed line to Warrington (1hr 06mins) and Liverpool (1hr 23mins), and then northwards splitting to go directly to Glasgow (2hrs 16mins) and Edinburgh (2hrs 9mins) offered the best value for money, generating revenue and benefits worth almost £55bn, paying for itself 1.8 times over.

Rail passengers would also be able to get to Liverpool in one hour and 23 minutes, from the current journey time of two hours and eight minutes.

Network Rail said the new line would require more than 1,500 miles of rail, sleepers and ballast, and 138 bridges over roads and current railway lines. It says the new line is required to ease the pressure on Britain's railways as passenger numbers have increased by 40% over the past decade, and many existing lines will be at full capacity by 2024.

Network Rail based its decision on a 12-month study involving 20,000 hours of work and more than 1,500 pages of analysis. They say that the line would account for 43.7 million journeys per year by 2030, which would result in 3.8 million fewer vehicle journeys and fewer carbon dioxide emissions.

Iain Coucher, Network Rail’s chief executive said: "High-speed rail can transform Britain. It can promote economic growth, regeneration and social inclusion. It is a low carbon option – cutting domestic flights and taking cars and lorries off the road. It will release capacity on the existing rail network and revolutionise passenger journeys."

"Demand for rail travel is growing and our main lines from the north to London are nearly full. By 2020 we will be turning away passengers – that’s not what we want. We need to start the planning now to meet future demand and the solution is a new high-speed railway to the Midlands, the North West and Scotland. The line has a sound business case that will pay for itself."

Transport Secretary Lord Adonis said that high-speed links were vital for the future, commenting "this report makes a powerful case for high-speed rail in Britain"

Lord Adonis said the company set up by the government to prepare a high-speed rail plan would take "full account" of the proposals and deliver a report by the end of the year, with a decision by next year.

Currently, the route proposal will be between London and the West Midlands, with options to extend the line to Scotland and the north of England.

Many questions about this project will need to be answered including the major one about the   -£34bn cost of the project. Only the government has the capability of funding such a large infrastructure project and government finances are under a considerable strain at the present time.

And there is the cost to passengers. In Europe prices are typically 30% higher for travelling on high-speed services.

The Conservatives' shadow transport secretary, Theresa Villiers, says she welcomes the announcement. "We're committed to taking high-speed rail to the north of England, and we think Labour should match that," she said.

The Conservatives currently propose to build a rail link between Leeds and London.

Network Rail said it had rejected routes that would have taken the new line via Leeds and Newcastle upon Tyne, as well as a route that included Leicester and Sheffield and another option through Bristol and Cardiff.