Labour yesterday failed in an attempt to get the Government to reconsider allowing a public company to bid for rail franchises.
Shadow transport minister Lord Davies of Oldham urged ministers to learn the lesson of the East Coast Main Line between Scotland and London's King's Cross, and let a public-sector operator run railways.
But the Labour amendment to the infrastructure Bill calling for a report from Transport Secretary Patrick McLoughlin on the issue was defeated in the House of Lords by 229 votes to 192, Government majority 37.
Lord Davies said a public firm should be able to "challenge the train operators on a genuinely level playing field in the public interest to secure value for money for passenger and the taxpayer".
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