The suspensions of three Department for Transport officials following the scrapping of the West Coast franchise bidding have been lifted, the department said.
Transport Secretary Patrick McLoughlin today announced the appointment of a Director-General with "responsibility for all rail policy and franchising."
"We will ensure that we have the right mix of professional skills inside the department and, where necessary, from professional external advisers," he added.
Mr McLoughlin made the announcement after confirming that Virgin Trains would continue to run the West Coast mainline until at least 2014.
Sir Richard Branson wrote in his blog that it was a "perfect early Christmas present" to learn that Virgin Trains will run the West Coast Main Line for a further 23-months.
He said: "It has been a long journey to get to this point, but we won’t be resting on our laurels and intend to keep improving services for our loyal customers."
On Twitter he said the deal was "reward for hard work and bravery of the team".
You have been telling us what you think of the decision to allow Virgin Trains to carry on running services on the West Coast Main Line for a further 23 months:
- Steve Smith: "Well done Virgin. I'm glad, it's the best company for the job. Keep going for long I say. Well done Richard."
- Alan Lowndes: "Doesn't matter who is running it. As soon as we get a light dusting of snow, all services will be cancelled."
- Marple Mills: "Welcomed and they should never have taken it away."
- Dave Carty: "I don't think it matters who runs it to be honest."
I'm delighted that we have an agreement with the DfT that gives us the chance to continue providing high-quality services to our customers.
We have had great support from staff and customers in recent months and we will repay that loyalty with even better service.
We will not be sitting back in the coming months, but are keen to introduce more improvements to the service.
The Shadow Chancellor Ed Balls told Sky News that the Government's handling of the West Coast Main Line has been "such a shambles".
We are determined to ensure not only that passengers continue to experience the same levels of service they have in the past, but that services improve.
There will be a new hourly service linking Glasgow and London and we will also work with Virgin Trains to explore other service improvements.
I am also extremely pleased that passengers will benefit from up to 28,000 more seats daily thanks to the delivery of 106 new Pendolino carriages on to the West Coast line which has happened on budget and ahead of schedule.
Transport Secretary Patrick McLoughlin announced the temporary deal, which will see Virgin carry on with the London to Scotland route until November 9, 2014.
After this time the West Coast Main Line will be let under a long-term franchise.
Virgin Rail will run the West Coast Main Line for a further 23 months, the Government announced.