Government considers this to be a ‘significant breach’ of the franchise agreement’s good faith obligation relating to financial matters, and will not be extending a further contract to current operator Go-Ahead Group and Keolis.

Transport Secretary Grant Shapps said there is “clear, compelling and serious evidence” that the franchise holder breached “the trust that is absolutely fundamental to the success of our railways”.

“When trust is broken, we will act decisively,” he said. “The decision to take control of services makes unequivocally clear that we will not accept anything less from the private sector than a total commitment to their passengers and absolute transparency with taxpayer support.”

The move to take over Southeastern services – which begins on 17 October – comes with the operator of last resort already running services on the East Coast Mainline and the Northern franchise.

Government moved train operating companies onto temporary ‘Emergency Recovery Measures Agreements’ in light of the pandemic last year, assuming full responsibility for cost and revenue. These new arrangements are intended act as a stepping stone towards the introduction of new Passenger Service Contracts which were detailed in the Williams-Shapps Plan for Rail in May.

Southeastern Railway said in a statement that the Government’s decision will have no impact on passengers or frontline staff and operations will continue as usual.

Transport Focus chief executive Anthony Smith said: “Whoever runs Southeastern, passengers will want a dependable plan which delivers on their key priorities – a punctual, reliable, clean and value for money service with enough room to sit and stand.”

He added: “In the long term passengers will want answers as to why this error occurred and assurances from Government and Go-Ahead that it is being investigated and fixed.”

Campaign for Better Transport spokesman Norman Baker said: “It is important that all public money spent on the railways is properly accounted for and that passengers who rely on this line are not adversely affected by the change of operator.”

London Assembly transport committee chair Caroline Pidgeon said the issues with the Southeastern franchise “should focus minds on how important it is for London to have a reliable, efficient transport network, particularly after the upheaval of the pandemic”. She called on the Government to hand over control of all suburban rail lines in the capital to Transport for London.

Transport Select Committee chair Huw Merriman – a season ticket holder on Southeastern – said transferring responsibility for services to the operator of last resort will not make any difference to passengers.

“I can understand why the Secretary of State and the Rail Minister have done this,” he told BBC Radio 4’s Today programme on Tuesday. “We need confidence in our railways right now and if there appears to be evidence of wrongdoing,” he said, “then it is right to sweep away” the current arrangement.

Meanwhile the Transport Select Committee published a new report this week on major transport infrastructure projects in which it calls on the Government to examine whether existing schemes will deliver their intended strategic benefits and policy objectives in light of the pandemic.

It recommends a new framework for assessing projects, replacing benefit-cost ratios with a ‘benefit-cost plus’ system to ensure value for money for the taxpayer while giving additional weight to geographical, environmental and social factors.  

Projects should also introduce ‘floors and ceilings’ for costs and timescales – rather than single target budgets and dates – and a future skills plan is urged to address workforce gaps which might delay projects.