Taxpayers face a huge compensation bill for West Coast contract fiasco Mr McLoughlin conceded that "deeply regrettable and completely unacceptable" mistakes by his officials would never have come to light if Virgin had not taken the government to court. His criticism of officials in his own department follows claims that too many civil servants obstruct ministers" decision and fail to implement government policy. Francis Maude, the Cabinet Office Minister, said yesterday it was "unacceptable" that some senior civil servants had "blocked" policies they were being paid to enact. In a round of broadcast interviews this morning, Mr McLoughlin, said three franchises that are currently being negotiated have been "put on pause." The minister, who was appointed in last month's reshuffle, conceded that taxpayers" money would be spent on compensating the companies that have lost out. We will reimburse the companies that have so far bid. We will have to re-run those. It is going to cost us a lot of money because of this mistake," he told BBC Breakfast. There are fears that the compensation bill could reach £40 million. Mr McLoughlin said he "fully accept[ed]" that the errors in the way civil servants handled the bidding process for the West Coast route would not have emerged without Virgin's legal challenge. The minister said he had launched two inquiries into the fiasco and that officials would be suspended from his department over the mistakes. The first investigation will attempt to establish what went wrong in his department and the second will examine how to ensure the awarding of rail franchises is handled properly in future. The minister was scathing about the failures of his officials. What has come to light is that there were serious mistakes made. "There was a very long process in which time a number of factors which should have been taken into account, it's now obvious they weren't taken into account," he said. Mr McLoughlin's predecessor, Justine Greening, had originally said the decision to award the franchise to FirstGroup had been the result of "a fair and well adjusted process." FirstGroup were promising more seats, new services, improved services, investment in stations and a better deal for taxpayers, she claimed in the summer. The same procedures were not followed and 'deeply regrettable and completely unacceptable mistakes' were made by the Department. The Government said on Wednesday that it is "consequently no longer contesting the judicial review sought by Virgin Trains Ltd in the High Court." He said he was examining whether Virgin could continue to run the services after the existing franchise expires or whether the rail line would need to be taken into government control.