THE Government has flatly ruled out allowing York-based rail operator National Express East Coast (NXEC) to change the terms of its franchise for the East Coast Main Line.

Transport Minister Lord Adonis said there was “no question” of cash-strapped companies being allowed to renegotiate their contracts, and said NXEC was continuing to make its franchise payments.

It is widely believed the company wants to alter its contract terms for running service along the route, which involves the payment of £1.4 billion premiums to the Government, after passenger numbers failed to grow as expected because of the recession. The company has been in regular talks with the Government but repeatedly declined to confirm what was under discussion.

Asked yesterday if the talks concerned the contract, Lord Adonis would only say: “We talk to train operating companies all the time.”

His comments came as the RMT rail union, backed by some MPs, launched a campaign for the flagship route to be renationalised.

RMT general secretary Bob Crow claimed the rail industry was facing chaos from a looming collapse of major franchises.

He said: “We are calling for the Government to step in now and begin the process of renationalisation to restore order to the railways.

“It would be political suicide for the Government to bail out National Express and offer a copper-bottomed management fee guarantee in return for ripping up the East Coast franchise.

“That would be reward for complete and abject failure on an epic scale and the British taxpayers would be up in arms.”

Seven MPs along the route of the East Coast line have signed an Early Day Motion at Westminster, saying they are gravely concerned that a termination of NXEC’s contract could leave a billion-pound plus hole in Government finances and believe that privatisation has failed the line after the previous collapse of the GNER franchise.

The House of Commons motion, tabled by Newcastle Central MP Jim Cousins, said if franchise payments cannot be met, the service should be taken into public ownership. None of North Yorkshire’s MPs have yet signed the motion.

A spokeswoman for NXEC said: “No one will be surprised by the RMT’s actions and suggestions – typically they are political, not practical.

“Public transport is most effective when it is a genuine partnership of the public and private sectors.

“National Express is committed to such progressive partnerships and will continue to focus on what is relevant to our customers and employees.”