Transport Secretary Chris Grayling said he would terminate the contract with Virgin Trains East Coast from the end of next month. An 'Operator of Last Resort' run by officials at the department will take temporary charge of services, he told MPs. The decision to end the £3.3billion contract this year has been described as a 'bailout' by Labour and trade unions. Stagecoach Group, which owns 90 per cent of VTEC, said it was 'surprised and disappointed' that the Government chose not to award it a new deal to continue running services on the London to Edinburgh route.

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