If Scotland is to have rail services operated on a not-for-profit basis (April 12), I can only hope that the business base will be established on a simpler level than is the current case with First ScotRail.

If Scotland is to have rail services operated on a not-for-profit basis (April 12), I can only hope that the business base will be established on a simpler level than is the current case with First ScotRail.

Everything that happens on Scotland's railways is directed by the Scottish Executive via the agency Transport Scotland. Running costs to First ScotRail are about £500m, of which fares raise roughly £250m.

The executive provides a subsidy for the balance. In effect, we get a rail system which the executive decides is affordable.

With me so far? Well, here's where Scotland's rail jigsaw wid fair gie oniebuddie a nippy heid.

The executive decides on the number, length and type of trains to be used on Scotland's network, and these trains are then purchased by train-leasing companies, outfits which are mainly subsidiaries of the major banks. The executive grants a fixed-term franchise to a train-operating company (in this case First ScotRail) to operate the trains within the terms of the franchise.

The ScotRail fleet of Turbostars (that's right - the one-size-fits-all trains that run anything from suburban to long-distance services, and are quite the poorest quality trains of their type in Europe) was acquired in 1999 by leasing companies Porterbrook and HSBC Rail on instructions of the executive, and operated by then ScotRail franchisee, National Express. When First Group gained the franchise in 2004, the same trains plus a few more of the same type were used.

First ScotRail pays a mileage charge to Network Rail for use of track, signalling and certain stations, and in turn keeps the fares, the rates of which are decided by the executive in consultation with First ScotRail.

Is gaining the ScotRail franchise good business? When the news broke that First had gained the contract, its shares leaped in price. Is the ScotRail franchise the dripping roast that critics claim it is? Does Sunday follow Saturday?

I'm informed by a colleague who says he knows about these things that it's now far more expensive to operate our current private rail system than ever it was in the days of the worst excesses of British Rail.

Gordon Casely, 45 Beaconsfield Place, Aberdeen.

Contrary to your reports ("Scotland may end private rail in four years" and "The battle to keep a nation on track", April 12), Network Rail has not been approached to take over train operations from First ScotRail.

The current structure of the railway industry is delivering for passengers and freight, with train punctuality at its highest for nearly eight years, improvements in cost efficiency and record investment going into enhancing the infrastructure. Naturally, we would listen to any major political party on any proposal it may have regarding the railways, but our strategy and focus, and the focus of everyone in the industry, is on continuing to improve the day-to-day performance of the railway for its customers, and not on any further structural changes.

Iain Coucher, Deputy Chief Executive, Network Rail, 40 Melton Street, London.