Mr McLoughlin said the report made "uncomfortable reading" and outlined its findings.
He told the Commons:
It is clear that the inquiry has identified a number of issues which confirm that my decision to cancel the franchise competition was necessary.
These include a lack of transparency in the bidding process, the fact that published guidance was not complied with when bids were being processed, inconsistencies in the treatment of bidders and confirmation of technical flaws in the model used to calculate the amount of risk capital bidders were asked to provide to guard against the risk of default.
The Laidlaw inquiry also mentions factors "that appear to have caused or contributed to the issues raised".
More top news
Dealing with migrants has become "part of the day job" for truck drivers, a haulage firm has told ITV News.
The Hearing Clinic has been hit with a £220,000 fine for bombarding people with millions of nuisance calls.
British Athletes are unlikely to achieve the same Olympic medal tally at Rio as they did at London in 2012, the head of UK Sport has said.