An extra £20m is to be handed over for Western Bypass improvements.
Government ministers have decided the extra cash will be handed over after £64m worth of work was announced earlier this year.
The move could mean an end in sight for thousands of motorists who regularly spend their mornings and afternoons stuck in A1 traffic jams.
Officials at the Department for Transport(DfT) will provide funding to build on the Lobley Hill to Dunston improvement scheme, announced in the Autumn Statement last year.
Plans will now be extended with an additional lane in both directions, with roads widened between Lobley Hill and the Coal House junction at the southern end of the existing scheme and from Dunston to the Metrocentre junction on the southbound carriageway, giving a total continuous three lane section of approximately 6.4km.
The funding comes after the Government agreed a multi-million pound City Deal with Newcastle and Gateshead councils. Among the key features was a commitment to working together to tackle to transport concenrs.
Last night Newcastle Council leader Nick Forbes said: “I welcome this investment as an extension of the existing £64m A1 Lobley Hill scheme which the council brokered through Newcastle’s city-deal process. I have continued to work closely with the Department for Transport and the Highways Agency over the past year to get the maximum benefit from the planned improvement and today’s announcement is the culmination of this hard work.
“The additional improvements will reduce congestion, speed up journey times round the Western bypass and improve the accessibility of major sites like Team Valley and Newcastle International Airport. Ultimately, this will enhance the North East’s reputation as a well-connected area with great development potential.”
Alongside this, a taskforce will report to the Transport Secretary within 12 months on the acceleration of further rail electrification schemes in the North of England.
Transport Secretary Patrick McLoughlin said: “Whether it’s unblocking bottlenecks on local roads, improving trouble spots on our motorways and trunk roads, or working to deliver better railways through electrification, these projects will benefit communities up and down the country and help keep Britain moving. By investing in our local and regional transport infrastructure we can help support new jobs and boost our overall competitiveness in the global economic race.”
The DfT also provided more than £3m for improvements to the A167 Cowgate Junction.
In 2012 George Osborne said he wants to make the A1 motorway standard from Newcastle to London, including a U-turn on earlier plans to drop improvements to the route through Yorkshire.
As part of his plans there will be new roads in both directions parallel to the existing A1 between Lobley Hill and A184 in Gateshead. Work is planned to start in 2014/15 with the scheme open for traffic in 2016.