Transport minister Stephen Byers has defended his decision to put Railtrack in administration saying he was not prepared to give the company "a blank cheque" funded by the taxpayer.

Byers set out the timetable of events leading up to the petition for bankruptcy. He said that the company had effectively asked for a blank cheque and suspension of the rail regulator, which would have been "a disaster".

Fighting back from severe criticism from both the City and some of Labour's own backbenchers, he described the new not-for-profit company to replace Railtrack as a "golden opportunity".

Eric Pickles, shadow transport minister, accused Byers of wrecking his department's own plans. "Who will trust the government again? Not the city institutions they will run a mile. It certainly won't be trusted by ordinary investors."

While MPs focused on Railtrack, Byers' aide, Jo Moore, continues to make headlines in the newspapers.

Moore, who recommended using the events of September 11 to "bury" bad news, was absent from the Commons as Byers made his crucial statement. Her disappearance prompts the Sun to ask "So where did Jo go?"

The Telegraph reports Byers rejected a call from No 10's director of communications, Alastair Campbell, to sack Moore following the leaking of her controversial email. Byers went over Campbell's head to the prime minister, who agreed she could stay if she apologised.

But Byers receives some good news this morning, with reports that financial regulator Sir Howard Davies is to dismiss Conservative calls for an investigation into the collapse of Railtrack.