Wollondilly MP Jai Rowell said this funding could free up more room to run extra services on the Highlands line.

The funding will allow for 40,000 passengers to be transported every hour in the city.

Mr Rowell said work was already underway to replace rolling stock across the state which would improve reliability for Highlands passengers.

“If that happens I’m pretty confident that will mean reliability at 100 per cent.”

Once this work is completed, Mr Rowell said there would be discussions with the federal government to prioritise passenger services over freight trains.