Northern Rail is set to be stripped of its franchise after the Transport Secretary announced he was 'taking action' describing the service as "unacceptable."
Grant Shapps told the BBC he has started the process that could result in removing the firm's routes.
It comes after a year of chaos and cancellations across the network - and on the day rail fares were hiked by an average of 2.7%.
Figures from the Office of Rail and Road show that only 56% of Northern services were on time in the last quarter and there have been protests held at Manchester Victoria station in recent weeks over the scale of delays.
German-based Arriva holds the Northern franchise, which is due to run until March 2025.
The chaotic introduction of new timetables in May 2018 saw up to 310 Northern trains a day cancelled, and punctuality and reliability problems continue to blight the network.
The existing agreement with Northern will be replaced by either a new short-term management contract or by nationalising services by putting the Government-controlled Operator of Last Resort in charge.
Northern leaders, Steve Rotheram, Mayor of Liverpool City Region, and Andy Burnham, Mayor of Greater Manchester, also welcomed the news: