Bus passengers in Norwich have been promised faster journey times and cuts to congestion after the government handed over �2.6m which will see radical changes to the city centre.

The scheme will see St Stephens Street closed to general traffic, a new bus lane put in on Grapes Hill. smart tickets for park and ride buses and the introduction of a reduced fare for 16 to 19-year-olds who use the city's buses.

Norfolk County Council learned today that its bid for a share of a �70m Better Bus Area Fund pot had been successful.

Transport minister Norman Baker, who visited Norwich this week, announced its bid for �2.6m had been successful.

More money will be added by councils, bus companies and businesses to build up a �2.9m package of improvements.

Among the biggest changes, general traffic would be removed from St Stephens Street and Surrey Street, so only buses, coaches, taxis and cyclists can use those streets.

The goal of those changes is to speed up journey times for buses travelling through the city centre, with the package also proposing a southbound bus lane in Grapes Hill, which would be in addition to the existing two lanes.

Other proposals are for traffic signals giving buses priority to be installed at more than 160 places in Norwich, 10 new bus shelters in Dereham Road and Newmarket Road, more than 20 real-time bus departure screens and the introduction of reduced bus fares for 16 to 19-year-olds.

Council officers and councillors say the cash will mean a shot in the arm for the city's ecomomy, as well as speeding up journey times.

Graham Plant, cabinet member for planning and transportation at Norfolk County Council, said: 'I am absolutely delighted. If you take this along with the Northern Distributor Road and the Norwich Area Transport Strategy, this is recognition that the government backs our long term plans. 'We have to sort out the traffic problems around Norwich and deal with the growth which is anticipated and these are ways of doing that. 'It will make it so much easier for people to use buses to get around the city.'

Simon Wright, Norwich South MP, said: 'This is great news for the city. I've been very keen to support the county's bid for funding and I've lobbied the minister on a number of occasions - including this week during his visit to Norwich.

'This investment will help buses to get around the city more quickly and more reliably. Given that one in 10 journeys in Norwich are by bus, this will bring benefits to thousands of passengers every day.'

'The severe congestion experienced by passengers during their commute has been hindering economic growth in Norwich and addressing this is a clear priority.'

'As well as improving journey times and capacity, this money will also deliver better bus shelters, real-time information boards, and new ticketing schemes. Bus travel in Norwich will be much more attractive once these measures are put in place.'

A separate bid for Local Sustainable Transport Fund money has been lodged which would see Chapel Field North two-way and new bus stops in Theatre Street and Red Lion Street,

Another part of that plan would be for cars travelling down Westlegate to be stopped from carrying on into Rampant Horse Street, but instead forced right into Red Lion Street.

The council is likely to find out in May whether that bid has been successful.

• See tomorrow's papers for further reaction.