The Ministry of Transport has insisted that its former boss, Putney MP Justine Greening, was unaware of the problems which led to the disastrous flaws in the West Coast Main Line franchise process.

The award of the lucrative contract to FirstGroup, ahead of four rivals including Richard Branson's Virgin Trains, was scrapped on September 26 because of bidding process "flaws".

It is understood the debacle will cost the taxpayer at least £40m.

The Times reported last week that Ms Greening, a former accountant at Price Waterhouse Coopers, learned of a potential flaw a week before the Cabinet reshuffle on September 4.

Speaking on the BBC last weekend Prime Minister David Cameron said: "I am extremely angry about what has happened, very apologetic that this has happened."

Ms Greening was unable for comment this week as she was on trip to Kenya in her new role as Minister for International Development.

New Transport Secretary Patrick McLoughlin said a "terrible mistake" in evaluating the four bids had been made by Department for Transport staff and that the fault lay "wholly and squarely" with the ministry.

Three civil servants - who face possible further disciplinary action pending an investigation - have been suspended as a result of the blunder.