The collapse of National Express’s contract to run the InterCity East Coast franchise is the latest blow to a rail franchising system that has come under increasing criticism from passenger advocates, regulators and, recently, the train operating industry.

The set-up has faced regular criticism for stifling the inventiveness and enterprise that the private sector was expected to bring to the rail industry. Operators are set strict rules by the Department for Transport about how they must operate, with their freedom of action mainly restricted to deciding where to make savings in order to meet the large payments promised to the department to win the franchise.