Railtrack allay fears over £2bn East Coast upgrade

The debt ridden company which collapsed at the weekend had been a partner in the vital project to boost capacity on the key passenger link between the North-East and London.

Today Railtrack chief executive Steve Marshall tended his resignation and blasted the Government's treatment of Railtrack as "shoddy and unacceptable" claiming it had broken promises over financial investments.

Unions also sought reassurances over the future of workers employed by the company, which was placed into administration by the High Court in London at the weekend.

Railtrack confirmed that it would only be able to honour infrastructure projects already signed following its slide into administration, casting doubt over the East Coast Mainline upgrade.

Phase one of the project - the upgrade of Leeds station has already begun and is due to be completed next year - but work on future phases for which contracts are still to be signed is yet to be carried out.

Tonight the Strategic Rail Authority, which has already pledged £17.5m for the route, stressed that plans for the East Coast Main Line were pressing ahead.

Gavin Bostock, of the SRA, said: "We have known for sometime that this was a project that Railtrack could not cope with based on its balance sheets and its role was not pivotal.

"There is a project development group in place to take the upgrade on and overall responsibility had already transferred from Railtrack to ourselves."

The Government had already committed a level of investment to the project through its ten year plan, said Mr Bostock.

Current franchise holder GNER said it had announced earlier this year a consortium of investors following doubts over Railtrack's financial position.

Spokesman David Mallender said that unlike the West Coast Mainline upgrade - a joint partnership between Railtrack and Virgin - the east coast equivalent was not as far advanced and would not be affected.