Taxpayers foot bill for Railtrack

Millions of pounds more of taxpayers' money will be spent on keeping Railtrack in administration for longer than expected, it emerged today.

Ernst & Young, the accountants now running Railtrack, confirmed that the administration period will extend for at least four to six weeks beyond the September target date.

The delay will cost taxpayers an estimated £1million a day after Transport Secretary Stephen Byers's decision to place the company in administration last October. The move comes a year after the Hatfield crash in which four people died. The derailment led to unprecedented disruption caused by fears over safety.

There is also concern that morale and performance will continue to be damaged by uncertainty over the administration period. George Muir, head of the Association of Train Operating Companies, today said it was vital Railtrack comes out of administration quickly and is replaced by a body that is "financially and structurally sound".

Railtrack Group, the non-operational part of the company that has been placed in administration, said the holdup will "delay decisions on major projects and create problems for the travelling public and employees alike". The delay is due to the fact that the business plan, which has to be put to potential bidders, has yet to be finalised.

It means Ernst & Young will be in charge until at least November - more than a year after the company was put into administration.