The contract for phase II of the upgrade of the Coleraine-L'Derry section of the Belfast-L'Derry railway will have to go out for re-tendering because current prices are too high, it has been revealed.

The SDLP described the announcement as a "slap in the face" for the North West.

John Dallat MLA described the news as "devastating", and accused Translink of not being fit to lead the plans.

Mr Dallat said: "I fully understand the frustration of the Minister who rescued this line from possible closure after the previous minister Conor Murphy left the coffers empty. However, the buck lies with Mr Kennedy and he must take ultimate responsibility for the actions and ineptitudes of the non-governmental bodies he is answerable for.

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"I welcome the fact that there appears to be an element of urgency in the Minister's statement and I sincerely hope this will be matched by action to redeem a situation which is a major setback in a process that promised an hourly service between Belfast and Derry.

"The Minister needs to seriously consider if Translink has the expertise or the commitment to be handling tendering processes of this nature. The thought has occurred to me that inter-city services should be the responsibility of all-island body capable of avoiding the kind of blunders we have now experienced twice in the last three years on the Derry-Belfast railway line."

(CD/MH)