York-based train operator Northern could be stripped of its franchise, Transport Secretary Grant Shapps said, as fares across Britain rose today by an average of 2.7 per cent.

The company is based in Rougier Street, near York Station.

Mr Grant told the PA news agency that “frustrated commuters will not have to wait long” before action is taken. 

The chaotic introduction of new timetables in May 2018 saw up to 310 Northern trains a day cancelled, and punctuality and reliability problems continue to blight the network.

But, a spokesman for the Department for Transport said that Mr Shapps had merely "started a process which would either strip Northern of its franchise or issue a short-term contract to them." 

It added: "We are taking action to ensure passengers in the North get a better service and we will provide an update in due course.”

A spokesman for Northern said that removing the franchise is an option, as part of the ongoing proposal process that the Transport Select Committee began last October.  

David Brown, Managing Director at Northern, said: “It’s on record that the Northern franchise has faced several material and unprecedented challenges in the past couple of years, outside the direct control of Northern. The most significant of these is the ongoing, late delivery of major infrastructure upgrades.

“The North West electrification was more than two years late, which meant we could not use electric trains on that route or cascade diesel trains from that route to run more services elsewhere on our network. More recently, new and longer platforms at Leeds stations are delayed, which means we have had to postpone our plans to run longer trains.

“These factors – alongside the damage caused by strike action and lower than expected economic growth – have had a significant effect on the revenue expected in our original franchise business plan agreed with the government back in 2015.

“That’s why the Government has asked us to prepare a business plan for a shorter ‘Direct Award’ which will see the completion of our transformation programme.”

David added: “Arriva and Northern remain fully committed to delivering the transformation of the North’s railways and improving customers’ experience. We are delivering the biggest transformation of local rail for a generation, with 52 of our 101 new trains in service and driver training taking place on dozens of more trains right now.

"Alongside 2,000 extra services per week, this is part of a £600 million investment in improving customers’ experience; we are continuing to invest in better stations, better offers for customers and more recruitment."

Office of Rail and Road figures show just 55.6 per cent of Northern trains arrived at stations within one minute of the timetable in the 12 months to December 7, compared with the average across Britain of 65.3 per cent.

German-based Arriva holds the Northern franchise, which is due to run until March 2025.

Mr Shapps described services on the route as “really bad” and claimed passengers have “had a nightmare on that line” since 2016.

Asked if Northern will be stripped of its franchise, he replied: “The simple answer to the question is yes, it is going to be brought to an end.

“It’s partially a legal process but frustrated commuters will not have to wait long.”