James Sherwood, president of Sea Containers, which owns GNER, is the first rail chief to admit publicly that the cost of supporting little-used regional lines is bankrupting the industry. He said that regional railways should go “to hell” and were not worth saving.

His views are shared by many in the Treasury, who believe that the railways have become an intolerable burden on the taxpayer.

Public subsidy for railways has more than tripled to £4 billion a year since privatisation eight years ago. A large part of that is spent propping up lines that carry very few passengers.

There are 400 stations in the network used by fewer than 25 passengers a day. A ten-mile journey on regional lines in Wales, Scotland and most of the North of England requires a subsidy of at least £1.60 per passenger. By contrast, most commuter and inter-city lines receive little or no subsidy.

Passengers on the busiest routes, including Midland Mainline, Thameslink, Thames Trains, Greater Anglia and GNER, actually pay a premium to the Strategic Rail Authority (SRA). A surcharge of about £8 is added to the cost of a return ticket between London and Edinburgh to help to subsidise other lines.

Mr Sherwood said: “We need to get the Government focused on trimming off the unnecessary bits that very few people use. The railways could probably be profitable if you could get rid of a lot of services. We have to get commuters and long-distance travellers to their destinations on time. But to hell with freight and regional railways which are running around virtually empty.”

His comments, made at a rail industry forum, break the tacit agreement among rail company leaders that they should always defend the industry’s right to keep consuming huge sums of public money to prop up loss-making routes.

The Treasury is putting great pressure on the SRA to justify the size of the network in the run-up to this summer’s spending review. The SRA has responded by suggesting that some lines could be closed for part of the day. In the longer term, some rail lines may be converted into tram lines or busways. But the SRA has so far refused to contemplate complete closures because of the ensuing political furore.

Sir Christopher Foster, a government adviser during rail privatisation, said: “Any discussion of the issue of rail closures quickly becomes hijacked by user groups. The Government and the SRA should not duck this debate.”

Mr Sherwood also called for the axing of all sleeper trains between London and Scotland, which cost the taxpayer more than £20 million a year. “The British taxpayer is paying the hotel bills of the people travelling on those trains.”

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