Commercial buyers, ranging from property developers to BAA, which runs Britain's airports, would be able to purchase stations - worth up to an estimated pounds 10bn in total - and use the sites for hotel, office, shopping and leisure complexes.
The track, platform and terminal facilities would then be leased to back to BR or to the new franchise operators under the rail privatisation programme.
The White Paper will ensure that statutory provision is made to protect rail facilities at stations which are sold. Ministers also recognise that, given the current state of the commercial property market, there is unlikely to be an immediate rush to buy.
But they are anxious to establish the principle that stations, which they regard as significantly under-used assets could be turned over to fuller commercial use. BAA has already signified interest in Paddington, as well as new stations serving its airports.
The White Paper will also propose the establishment of a new rail regulatory body to oversee the privatised rail services and stations and ensure fair competition between BR and private sector rail franchise operations.
The White Paper was approved at last Thursday's Cabinet meeting which brought to an end a lengthy period of inter-departmental wrangling which resulted in detailed proposals being delayed until after the election. Malcolm Rifkind, Mr MacGregor's predecessor, had orginally been expected to produce a White Paper well before polling day.
Franchise holders will be able to set their own prices, timetables and service standards. But the rail privatisation bill, which is expected to go through the Commons in the 1992-3 parliamentary session, will ensure the companies have to meet approved performance standards.