OF ALL THE excuses offered for the governmentís shambolic handling of the West Coast Rail Line bidding process, quite the most bizarre has come from one of the most powerful men until recently at the heart of Westminster: blame low civil service pay.

This has come from none other than Lord Gus O'Donnell, former Cabinet Secretary in the previous Labour administration. It confirms a growing suspicion that if the government's handling of the FirstGroup bid for the Glasgow-London rail franchise was not enough of a shambles, be braced for worse to follow.

Already senior officials at the Department for Transport are racing to put as much distance between themselves and responsibility for a debacle that saw FirstGroup shares crash by 20 per cent.

Transport Secretary Patrick McLoughlin last week slammed on the brakes after the award of the rail franchise to FirstGroup was found to be seriously flawed. The decision is a humiliating climb-down for the government which had insisted the award to be "robust" in the face of loud protests from Virgin boss Sir Richard Branson that the FirstRail sums did not add up.

Not only will this result in considerable delay to the franchise process for this particular line, but the DfT also ordered that work on a clutch of other rail franchise bids was "paused".

This will almost certainly trigger significant delays of up to a year both for the companies directly involved and consequential knock-on effects for companies in the supply chain.

Bidders for the three franchise contests now on hold – Thameslink, Essex Thameside and Great Western – will have incurred total costs of about £50m and could seek to claw back that amount. Taxpayers may find themselves lumbered with a further £75 million from the loss of franchise payments for the first years of delayed franchises.

The £200 million plus plunge in FirstGroup shares alone is set to trigger legal claims against the government for compensation that could dwarf the £40 million bid costs the DfT has already promised to pay. And in in an astonishing intervention late last week, Lord O'Donnell said government departments were suffering from "skills shortages", particularly in procurement and that civil servants should be paid more to stem the Whitehall talent drain. According to estimates by the FDA union, one in four senior civil servants have left the DfT since 2010.

The idea that the franchise debacle could result in higher pay awards for civil servants will outrage a public that will also have to pick up the tab for a blizzard of compensation and legal costs.

The most senior of the suspended civil servants - former Goldman Sachs executive director Kate Mingay who was corporate finance director at the DfT - now claims she was not involved at key stages of vetting the bid.

Investigations are set to focus on a 'breakdown in procedure' in the parallel conversations the DfT held with Virgin and FirstGroup towards the end of the bidding process.

It is said the rival train operators were led to differing interpretations about how risk would be assessed and calculated, modifying the sums both felt able to bid.

The department said the "flaws stem from the way the level of risk in the bids was evaluated. Mistakes were made in the way in which inflation and passenger numbers were taken into account, and how much money bidders were then asked to guarantee as a result".

The debacle is a crippling blow to the competence and credibility of the Westminster coalition. It adds to a long and depressing list of examples where the doctrine of 'the government knows best' has collapsed in an ignominious heap.

Coming at a time when there is massive pressure on the government to embark on 'shovel ready' infrastructure projects, it is a reminder both of the fallibility of governments and the knock-on consequences when things go wrong.

Who can be held to account? No-one it seems. And don't expect the inquiry to advance much by way of reform: it's led by a member of the DfT board.

The DfT's chief financial officer denies responsibility. The politicians say 'it wisnae me'.

There is some black truth in this assertion. The Department of Transport is one of many ministries that have come to be used as no more than stepping stones for 'here today, gone tomorrow' politicians.

In fact since 1997 there have been 12 Secretaries of State for Transport and from 2001 alone there have been no less than eight: Alistair Darling, Douglas Alexander, Geoff Hoon, Ruth Kelly, the Lord Adonis, Philip Hammond, Justine Greening and now Patrick McLoughlin.

What does it suggest about our commitment to long term management of transport when ministers are barely in the job when they are moved on?

As for Lord O'Donnell's pennyworth that the DfT has suffered from a brain drain of civil servants and that they should be paid more, there is some truth to the claim that outside consultants have been able to cherry-pick the talent within departments, leaving government recruiters with a problem. But the notion that their pay should be increased would only add insulting taxpayer expense to this hapless merry-go-round.

Both Sir Richard Branson and FirstGroup were assured that the franchise vetting process was 'robust'. It was no such thing. Knock-on consequentials along the supply chain of this and other rail franchises could be massive. Arguably the greatest damage of all is to the credibility of government. What is the value of the word 'robust' now from ministers' lips?