John Robinson, chairman of Railtrack, has described the government's handling of the company as "unethical, if not immoral".

Speaking at the National Railway Museum annual dinner in York, Robinson denied government claims that extra funding was requested month after month, alleging that the only cause of Railtrack's receivership was the decision of transport secretary Stephen Byers to "renege on a £450 million transaction" and withdraw public funding.

Robinson commented that staff, of which 92 per cent were shareholders, were left "feeling bitter and undervalued".

He said: "Trust and honesty are the basics of business relationships and government to business relationships - this was clearly lacking. The history of this railway shows us that investment is the key to success, while government interference is the route to fail".

Government's action over Railtrack, he argued, would scare away potential investors in the replacement company. Robinson has already turned down an offer to chair the company, which Byers has suggested should be non profit-making. However, Robinson also criticised this model as "a hybrid from hell".

"Dipping in and out of the railway - taking credit for the good and castigating the bad - is unhelpful, as is a flood of investment concluded by a drought", he said.

However, his comments were dismissed by Labour's Lawrie Quinn, MP for Scarborough and Whitby and chairman of the all-party parliamentary rail group.

He said: "I don't think the government should take any lectures from Railtrack, who were a company that continued to pay massive dividends to shareholders, while at the same time coming cap-in-hand to the taxpayer for yet more public money.

"The government had to act to safeguard the interests of the travelling public".