An investigation is being launched into the Strategic Rail Authority's (SRA) decision to take away Connex's franchise to run trains in the South East.

The beleaguered French firm operated in Hastings, Crawley and Horsham but lost its franchise after asking for too many Government subsidy grants.

The SRA effectively renationalised the network by setting up its own subsidiary, South Eastern Trains, and giving it control of the Connex routes.

The National Audit Office is investigating whether the SRA made the right decision.

South Eastern Trains has achieved better punctuality but is asking for larger subsidies.

In its last year Connex took subsidies of £6.25 million every month. South Eastern Trains has taken £10 million every month.

Thursday February 10, 2005