It's full speed ahead for the Luton-Dunstable Busway after the scheme received the government seal of approval.

Luton Borough Council, which says the project will allow more people to use public transport and leave their cars at home, announced yesterday that the official green light has come from Whitehall.

The Department for Transport approved the £85million busway - jointly run by Luton Council and Bedfordshire County Council - and agreed to provide a £78million grant, with the remainder of the cash secured through additional investment.

Town Hall officials say the busway is a key component of the councils' commitment to improve public transport. Running between Houghton Regis, Dunstable and Luton, it will make getting to work, going to the shops and travelling around town easier and more affordable, claim traffic experts.

Providing a fast, frequent and efficient alternative to travelling by car, it will also help to combat congestion and enable people to do their bit for the environment, says the council.

The busway will be within easy reach of an estimated 184,500 people, catering for an emerging growth in employment and housing in the area, when it is formally opened in 2011.

Welcoming the government's decision, Councillor Roy Davis, who has special responsibility for regeneration, said:

"By giving people the option of travelling to work or going to the shops without the hassle of endless traffic jams or the expense of high fuel prices, we can make our roads safer and our environment cleaner.

"The busway has consistently proven to be the most cost-effective option on the table and this decision takes us a step closer to completion. Now we can get to work on building and delivering it."

Councillor Tom Wootton, Bedfordshire County Council cabinet member for highways and transport, said: "The busway will help to reduce congestion in the Luton/South Bedfordshire area and give people a real, sustainable and green alternative to the car. It is good to hear that it will definitely be going ahead."

The next step is to invite bids from potential private partners to build the busway. This will happen over the coming months, during which the council will continue to prepare the site for construction.