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A major review of the way Britain's railways are run looks set to be launched by the government on Monday.
An announcement would end weeks of speculation about the Strategic Rail Authority losing much of its power to the government.
Analysts have talked of the plans meaning "creeping renationalisation".
On Sunday the department did break its silence to strongly deny claims its chief watchdog, SRA chair Richard Bowker, would be asked to resign.
Tory transport spokesman Damian Green said it was "extraordinary" the government was changing a policy it had first implemented just three years earlier.
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