Transport Minister Lord Macdonald confirmed that Railtrack would almost certainly be stripped of its role in safety regulation.

At the same time rail regulator Tom Winsor announced that he is seeking advice on whether the rail companies involved in the crash were in breach of their licence obligations.

Lord Macdonald with the government statement

He is also examining whether Railtrack was in breach of its safety licence obligations following the publication of a report by the Health and Safety Commission on the company's performance.

Railtrack has promised its full co-operation to the government to improve rail safety.

Railtrack's Richard Middleton insists the company has met its safety obligations

Its commercial director Richard Middleton insisted the company could provide evidence to satisfy Mr Winsor that it had met its existing obligations.

The latest developments came as the Queen visited the site of the crash in west London to see the devastation for herself.

'Ensuring public confidence'

The BBC's Steven Evans: Political issue of rail safety is rising dramatically

Lord Macdonald said the HSC report on Railtrack's role in safety regulation reported "concerns inside the rail industry about aspects of present practice".

These concerns include:

• The feeling among some that the railway group standards that Railtrack had developed "lack depth and technical soundness"
• There seemed "less satisfaction with the process of decision over standards-making"
• Incident investigation - "there are some views that this is conducted too defensively and with insufficient openness"
• There was a general view that the principal problem was ... "the stifling effect of possible criminal proceedings on public inquiries and the publication of reports"
• There was also "a general acknowledgement of a lack of strategic safety research" although there was no universal view that this was "a critical deficiency".

However, Lord Macdonald stressed it did not say the company's role had caused "major failures".

But he said it was right that Railtrack should lose its regulatory role so he could "ensure public confidence there is no conflict between safety standards and commercial interest".

In a statement in the Lords, he said: "This is something that Railtrack has accepted and indeed welcomed."

The government was prepared to introduce new legislation to set up a new safety regime if required, he added.

Enforcement notices

The minister also revealed that the Railway Inspectorate had issued enforcement notices banning the use of Signal 109 until Railtrack had taken action to prevent it being passed at danger, as it was in the Paddington crash.

Lord Macdonald: No compromise on safety

Railtrack has also been given until 6 November to introduce "additional controls at the other 21 signals passed at danger most frequently".

By the same date it will also have to publish plans to improve the safety of all other signals which have recently been passed at danger.

Train operators have also been ordered to brief drivers on the location of all suspect signals and how to deal with them.

Lord Macdonald said Deputy Prime Minister John Prescott had also asked the HSC to give him a weekly report on incidents when trains went through danger signals.

"He also requested a report by the end of this week on action undertaken by Railtrack to improve safety on the approach to Paddington station," he said.

Safety review

Labour MP Gwynneth Dunwoody:"A lot of things were recommended a year ago"

Ministers have already announced a public inquiry into the Paddington crash, to be chaired by Lord Cullen, as well as a separate general rail safety review under Sir David Davies.

The latter will consider the relative merits of the rival rail safety systems.

The train drivers' union Aslef has threatened strike action if rail companies refuse to install the Automatic Train Protection (ATP) system, which stops trains if they go pass a signal which is at danger.

ATP was recommended by the report on the Clapham crash. But the government instead ordered that the cheaper Train Protection Warning System (TPWS) should be installed across the network by 2004.