Highways bosses have announced their preferred bidder for the £260m project to upgrade, maintain and operate a 33-mile section of the Great North Road.

And as an incentive to minimise disruption, they plan to pay for the work on a pioneering sliding-scale system.

The design, build, finance and operate contract for the section of the A1 from Darrington, near Pontefract, to Dishforth, near Thirsk, is to be negotiated with Road Management Limited, RML.

The contract involves the upgrading of two short chunks of the road to three-lane motorway standard -- and the future mainatance and operation of the whole 33 miles for another 30 years.

The revolutionary payment system has been developed by the Highways Agency and is based on the contract-winning company's ability to minimise congestion, reduce road accidents and provide a high-quality operating service.

They will be paid on a sliding scale depending in the volume and speed of traffic using the upgraded road.

The idea is that it will act as an incentive for the operators to conduct essential activities, such as maintenance works, at off peak periods and to attend accidents quickly.

Project leader Alec Briggs described the payment mechanism as innovative.

"The built-in incentives to the operator have been designed to help us to achieve our three key priorities of reducing congestion, enhancing the reliability of journey times and improving safety for all road users on what is a very busy route," he said.

It is expected that the contract will be awarded towards the end of the year and construction work should start next April.

Last June Transport Secretary John Spellar announced the further upgrading of another 24 mile stretch of the A1, from Dishforth to Barton, near Richmond, as part of another £263m package of improvements.

That project is due to be completed in around eight years time when virtually the entire length of the A1 in North Yorkshire will have been upgraded to motorway status.