Suspended Department for Transport Kate Mingay has issued a statement following the cancellation of FirstGroup's West Coast Main Line deal, in which she states her role has been "inaccurately portrayed".
Former cabinet secretary Lord O'Donnell, who retired last December, admitted the West Coast fiasco "does raise some issues about skills in the civil service".
He said civil servants who made mistakes should be held accountable, telling the BBC Radio 4 Today Programme:
Senior Labour MP Margaret Hodge said the West Coast main line rail fiasco exposed flaws in Whitehall processes.
She told BBC Radio 4's Today Programme: "It exposes in a very stark way that the present conventions on accountability between civil servants and ministers to Parliament and the public aren't working.
"It's yet another example ... of where the civil servants themselves have not really captured and taken on the role that is expected of them in today's society."
She added: "The way you climb the greasy pole in the civil service is that you change your job every couple of years.
"That's a disaster and we need to leave people in post so they take proper responsibility for the very difficult and complex job they have to do.
"Then we have to open up this issue of accountability so they can't hide behind lack of accountability for not telling us what the outcomes are."
Holyrood's Transport Minister will today make a statement on the "shambolic" cancellation of the West Coast main line rail franchise.
Keith Brown is expected to outline his concerns about the handling of the UK Government u-turn which has cost taxpayers £40 million.
In the wake of the controversial decision, Mr Brown complained that the Scottish Government was given no warning of a decision which affects the country.
He said: "This is a shambolic situation that affects thousands of passengers in and out of Scotland."
Sir Richard Branson criticised former Transport Secretary Justine Greening today after the government was forced to make an embarrassing U-turn on the West Coast Main Line rail franchise deal.
In an interview with Channel 4 News, the Virgin boss also claimed the Department for Transport had "certainly made the same mistake" with other bids.
When asked if Ms Greening was "incompetent," Sir Richard replied said, "I'd rather not comment on previous ministers".
FirstGroup Chief Executive Tim O'Toole told ITV News he was "shocked and bitterly disappointed" that the government has cancelled its West Coast Main Line rail franchise deal.
Shares in FirstGroup plunged nearly 21 percent today after the company lost the West Coast Main Line rail franchise.
The FTSE 250-listed firm saw shares drop 20.74 percent to 193.40p, wiping more than £240 million off its value.
Sir Richard Branson told ITV News that there were a number of errors made on the West Coast Main Line rail franchise and said they were "very much the ones we (Virgin) were warning about".