NICOLA Sturgeon has been urged to put country before party and campaign for the East Coast Main Line to be removed from one of the SNP’s biggest donors.

Labour will today call for a “cross-party alliance” to keep the troubled rail service out of the hands of Sir Brian Souter, after his Stagecoach business bungled the current franchise.

Shadow Transport Secretary Andy McDonald and Labour MSP Colin Smyth will make the demand as they meet workers at Edinburgh’s Waverley station.

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The UK government revealed in February that Virgin Trains East Coast, in which Stagecoach is the 90 per cent lead partner and Virgin has a 10 per cent stake, had collapsed.

Transport Secretary Chris Grayling said Stagecoach breached a “key franchise covenant”, was incurring unsustainable losses, and so the deal would end almost three years early.

“Stagecoach got its numbers wrong, it overbid and it is now paying the price,” he told MSPs.

However the left the door open to Stagecoach continuing to run the service on a non-profit basis until 2020, potentially sparing them millions due to be paid under their original £3.3bn bid.

The other option being considered is taking the East Coast line back into public ownership.

The line was last in public ownership in the six years up to 2015, following the collapse of the National Express franchise in 2009, two years after a GNER franchise failed in 2007.

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SNP Transport minister Humza Yousaf recently backed opportunities for public sector operators in rail, but said no options “should be taken off the table” for the East Coast.

However Labour, which wants public ownership of the line, said one option should be ruled out immediately - letting Stagecoach carry on despite their previous mistakes.

Opposition parties suspect the Scottish Government is reluctant to oppose Stagecoach because Sir Brian, its co-founder and chairman, has given £2.6m to the SNP since 2007.

Mr McDonald said: “We cannot continue with a broken railway system that rewards failure. Rail franchising is discredited and disintegrating. It is time the SNP government was clear - the East Coast Main Line should go back into public hands.

“Only Labour will ensure a fully nationalised rail network so that every train that rolls through Scotland’s stations is run for the benefit of the public, not to line shareholders’ pockets.”

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Mr Smyth added: “The SNP government must finally break its silence and back public ownership of the East Coast Main Line.

“Humza Yousaf can no longer hide behind weasel words around supporting a public option – he needs to be clear that he supports public ownership.

“There is an opportunity here to build a cross-party, cross-border alliance and out pressure on the Tory government to hand East Coast back to the people.

“If the Scottish Government cannot bring itself to support the nationalisation of our railways it must at least agree Stagecoach should be barred from bidding for the route again. Having mismanaged the route so badly, East Coast should be kept out of Brian Souter’s hands.”

LibDem MSP Mike Rumbles said his party also opposed Stagecoach retaining control.

He said: “Stagecoach failed spectacularly to deliver on its East Coast Main Line rail contract, compromising one of Scotland’s most important transport arteries. Given this history, it would be right to exclude Stagecoach from the shortlist for further contracts of this kind.

“We need to know our rail providers are reliable. Let’s not make a habit of rewarding failure.”

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A spokesperson for Mr Yousaf said: "We will take no lectures from Labour on this issue. We have long made clear our preference for public sector operators to be given a fair chance to operate our railways, but previous UK administrations – both Labour and Conservative – repeatedly blocked those powers coming to Scotland.

“The UK Government has the contractual relationships with East Coast Rail’s operators and they should be held to account for the current situation. Our priority is to ensure continuity of services for travellers. No options for the future of the East Coast Mainline should be taken off the table, including the UK Government continuing to run the contract and returning the appropriate profits to Scotland.”

A Stagecoach Group spokesman said: "East Coast is a well-run, profitable railway and we are continuing to meet our contractual commitments as well as progressing our £140m investment plans.

"We are delivering more passengers, increased investment, 30 per cent higher payments to the taxpayer, and better average customer satisfaction than when the East Coast route was in public ownership.

“We firmly believe we continue to offer the best way forward for passengers, taxpayers and local communities as the government looks to transition to its planned new East Coast Partnership franchise.”