PASSENGERS on Scotland's trains will enjoy the type of fare structure offered by budget airlines, the Dutch company due to take over the franchise has said.

Abellio has promised inter-city fares from £5 and cut-price travel for jobseekers, the newly-employed and over-50s amid a welter of new measures set out yesterday.

Scottish Transport Minister Keith Brown said Abellio pitched "the least expensive but most cost-effective" bid to take over ScotRail from Aberdeen-based FirstGroup.

Among the pledges made by the group on being announced as the next franchise holders are plans to introduce free wifi to all trains, bring in 23 per cent more carriages across the network, bring in high-speed intercity diesel trains with over a third more seats and start a Great Scenic Railway scheme bringing more tourists to the north, the south west and the Borders.

Stations at Aberdeen and Inverness will also undergo a revamp, with the addition of major shopping developments, while the Dutch love of the bicycle will be present in the adoption of a new approach to cycling, with more than 3,500 parking spaces and bike-hire at a number of stations.

Dominic Booth, managing director of Abellio UK, insisted there would be a "meaningful" number of £5 fares.

"It's a bit like the equivalent of easyJet or Ryanair, where there will be a certain number of £5 fares on trains that have got lots of free seats, then when they are used up it will go to £6 and then £7," he said at a press conference at Edinburgh Waverley station.

"If you have a quota of only one or two £5 fares there will be reputational damage, so you have to have a meaningful number, but obviously on trains where there is lots of spare capacity.

"If you have a quota that is tiny you end up getting bad publicity, so it has to be accessible."

The firm has given the workforce a commitment of no compulsory redundancies, that staff will be paid at least the living wage, and that there will be at least 100 apprenticeships and protection of pension and travel rights. Mr Brown said: "There is a huge range of evaluation criteria and one of them was cost.

"It was the least expensive, that is true, but it was also the one that was the most cost-effective."

FirstGroup said it was disappointed it would not be able to implement its plan for "even greater levels of service and growth".

Praising FirstGroup's tenure, Mr Brown said: "My feelings go with them and their employees. Of course we want to see Scottish companies prosper but we do not have the power to guarantee that."

Liz Cameron, director and chief executive of Scottish Chambers of Commerce, said Abellio comes with "a strong track record in the industry, both within the UK and internationally".

Transport campaign group Transform Scotland welcomed Abellio's award.

Spokesman Paul Tetlaw said: "We are pleased to see many of the improvements we had called for are specified in the new franchise.

"However, there will need to be serious investment in the inter-city routes and it is imperative the Scottish Government now comes forward with detailed plans for infrastructure enhancements."

Ross Martin, chief executive of the Scottish Council for Development and Industry, said: "We warmly welcome Abellio's plans for faster, more frequent services on the inter-city network, particularly the introduction of proper inter-city trains for the key Aberdeen and Inverness to Central Scotland services, and to transform stations such as Aberdeen."