Rail passengers on the new South Western Franchise are set to be the first outside of London to benefit from smart ticketing.

Bidders for the new franchise will be asked to set out how a new smart ticketing system could be introduced across the mainline franchise area from 2009 onwards.

The operator of the new franchise will have to ensure the new system also accepts existing Oyster products in London zones 1 - 6. This will ensure that future passengers can use Oyster Pay as You Go products as well as the newly available smart tickets.

In advance of this introduction a zonal fares structure will be introduced for single and return fares across the Capital's rail network.

The details are contained within the Invitation to Tender that has been issued to bidders for the new Franchise. It covers services currently operated by South West Trains and the Island Line on the Isle of Wight - both currently operated by Stagecoach plc.

The ITT specifies the minimum level of service the Department will require from the new operator. Bidders will be asked to show how they will meet the requirements it sets out and how they will ensure value for money for the taxpayer.

It details the minimum number of services the Government will require the operator to provide. This is based on the current timetable that has led to a marked improvement in performance. Only minor changes are suggested.

The specification will require bidders to address current and anticipated passenger growth and ensure that performance continues to improve. In particular they will have to set out how security at stations and on the trains can be improved where necessary.

Transport Secretary Alistair Darling said:

"As technology advances it is vital that we ensure that future passengers benefit from the improvements it can bring.

"Passengers on these routes will benefit from smart integrated ticketing across the franchise area - we will be working with train operators to ensure similar benefits can be introduced for passengers elsewhere.

"This is just one improvement the new operator of the South Western Franchise will be required to introduce. Additional capacity, safer stations and better pricing structures will all lead to a better service to passengers."

There are four bidders for the South Western franchise; Arriva Trains South West Limited (Arriva plc); First South Western Limited (FIrstGroup plc); Great South Western Railway Company Limited (a joint venture between GNER Holdings Limited and MTR Corporation Limited of Hong Kong) and Stagecoach South Western Trains Limited (Stagecoach Group plc).

The franchise will become operational on 4th February 2007 and will run for up to 10 years, the final three years being dependent on performance. The winner will be announced in Autumn 2006.