George Osborne is to give the green light to High Speed 3 (HS3), a high-speed rail link between Leeds and Manchester in this week's Budget as he seeks to resuscitate the North of England's economy.
The plan, mooted by the Chancellor last year, is opposed by the same campaigners who believe that the £42.6bn HS2 railway from London to the North is a waste of money and will ruin the countryside.
The Department for Transport (DfT) is to release a business case endorsing the construction of HS3, which will reduce journey times between Leeds and Manchester from 48 minutes to around half an hour.
Mr Osborne wants to create what he has dubbed a "northern powerhouse" to rival the economic supremacy of London and the South-east - and a vastly improved transport infrastructure is vital if that ambition is to be fulfilled. The DfT's plans will tackle accusations by the Stop HS2 campaign that HS3 has "no plan, no route, no budget, no timescale".
It is understood that Mr Osborne intends to mention HS3 in his Budget speech on Wednesday before the publication later this week of the document.
This will recommend that HS3 has a later, extra phase that would see it extended to other cities in the North of England, probably Liverpool and Hull, and narrow down the current estimated "budget envelope" of £7bn-10bn.
HS2 will initially link London and Birmingham, before splitting into two lines reaching Liverpool and Leeds.