Great Northern, which operates through Welwyn Hatfield and Potters Bar, may be put under a new rail operator that will be be run under public control, it has been announced today.

The proposal comes as part of Transport Secretary Chris Grayling’s announcement in the Commons today that the East Coast line, which serves Stevenage, would be taken over by an “operator of last resort”.

The East Coast service, which has been operated by Stagecoach Group and Virgin Trains since 2015, will be rebranded the London and North Eastern Railway (LNER) from June 24.

If a franchise is terminated or there are no acceptable private bids, the Secretary of State for Transport can take over the franchise as an operator of last resort.

Chris Grayling said that no decision had yet been taken on the future of the Great Northern franchise, but that Great Northern services coming out of London King’s Cross might be merged into LNER.

He also said it was likely the contract under which Govia Thameslink runs the Great Northern line would be separated into two or more contracts after it expires in 2021, and that he was having talks with the Mayor of London about whether some Great Northern services might be transferred to London Overground.

A Great Northern spokesman said in response: “The government brought together Great Northern and Thameslink with Southern and Gatwick Express with a purpose and that was to modernise and introduce a new, expanded Thameslink network – which is what we will be doing from Sunday.”

Stagecoach said it and Virgin had been negotiating for a new contract with the Department for Transport but that it understood Mr Grayling was “no longer considering” them for the deal.

Stagecoach chief executive Martin Griffiths said he was “surprised and disappointed”.