Fallout from the West Coast Mainline franchise negotiations has led to a major restructuring at the Department for Transport. A new position of director general for rail is to be created and there will now be a director responsible for overseeing rail franchising programmes. Senior individuals will then lead each franchise competition as they come up for renewal.

The department’s Permanent Secretary Philip Rutnam announced the restructure hours after a damming report by Centrica chief executive Sam Laidlaw into the West Coast franchise competition was published on behalf of Government. In it Mr Laidlaw highlighted “deficiencies in the organisation structure” at DfT and said there had been “inadequate planning and preparation” at the department in respect of the multi billion pound contract.

Ministers made an original provisional contract award in August without being told about the critical flaws and having been given “inaccurate reports” the report added.

Incumbent West Coast operator Virgin Rail lost out to First Group for the right to run trains on the route between London Euston, Manchester and Glasgow for the next 13 years. The competition was cancelled in October after failings were identified in the bidding process. Virgin will continue to run trains on the West Coast line until November 2014 after which a long term franchise will be awarded.