Mr McLoughlin told MPs plans were continuing for an interim contract with Virgin to operate for up to 14 months while the franchise process was rerun.
He said passengers would see the same staff on the same trains and the service would be "enhanced":
In dealing with this, my department has been frank and open about its mistakes and is absolutely determined to find out exactly what happened.
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Rain spreading eastwards throughout the day.
"His fiancee gave birth this morning, of all mornings! We were scared because we've got Glastonbury tonight", said co-singer Chloe Rhodes.
Festival-goers have been enjoying the second day of the Glastonbury festival.