TRANSPORT group National Express has made £500m running its rail operations despite receiving £2.5bn in public subsidy, MPs were told today.

The firm, which has refused to fund the loss-making East Coast Main Line beyond the next few months, has "ripped off" the taxpayer, Labour's John McDonnell (Hayes and Harlington) said.

He made the claims in a Westminster Hall debate and attacked the level of subsidy received by the firm, which he said had axed 750 staff.

MPs demanded that the London to Scotland line be run by the public sector for up to 15 years to act as a "comparator" with the rest of the privately-run rail network.

The line is set to be taken over by the Government as National Expresss funding for the East Coast is expected to run out later this year. It will be the second time the line has lost a private operator after GNER collapsed in 2006.

Earlier this month Transport Secretary Lord Adonis set up a new public organisation which will operate the line and it will then be re-franchised again within 18 months.

Mr McDonnell said: "National Express have taken this Government literally for a ride.

"They have made £500mn profits out of a £2.5bn public subsidy. They have increased the fares this year - regulated 6 per cent, unregulated 7.4 per cent.

"On the East Coast and the East Anglia line they have laid off 750 workers. Can't we get the message? We are being ripped off."