A powerful committee of MPs has called on the government to gain a tighter grip on how taxpayers' money is spent on the railways.

In a new report released on Tuesday, the Commons public accounts committee found that much of the £1 billion annual subsidy given to the privatised network has been wasted on trains that have been delivered late and do not meet the needs of passengers.

After an inquiry into the procurement of new rolling stock and the soon-to-be abolished Strategic Rail Authority's leadership of the industry, the MPs concluded that ministers must rein in excessive and unnecessary spending in a way the SRA has failed to.

Transport secretary Alistair Darling announced earlier this month that his department will take on many of the functions currently carried out by the SRA.

And committee chairman Edward Leigh said the ministry must now take on responsibility for ensuring value fro money.

"The difficulties faced in bringing new trains into service epitomised a fragmented rail industry lacking real leadership," he said.

"The government has since announced the results of its rail review. The Strategic Rail Authority will be abolished and its strategic functions moved to the Department for Transport.

"It is the department that must now take the lead on implementing my committee's recommendations, and take decisive action to ensure new trains are reliable, fully meet the needs of passengers, and are introduced on time."

The MPs found that the SRA has not been robust enough in ensuring new trains are designed for the needs of passengers, particularly those with disabilities.

The report concluded that train operating companies and rolling stock leasing companies should be compelled to work more closely with each other, manufacturers and passengers' representatives in the delivery of major stock renewal projects.

Stricter timetables should also be enforced in the delivery of part-publicly funded investments, the committee said.

And the MPs called for minimum standards on service quality and reliability to be included in the franchises awarded to operators.