Mick Lyons, chair of West Yorkshire Passenger Transport Authority, said that passengers on Regional Railways North East (RRNE), which runs trains between Newcastle, Manchester and Liverpool, have been "faced with the worst service they have had in the last 10 years. In the most recent four- week accounting period 703 trains have been cancelled with a further 47 part-cancellations," he said.
The cuts in services have badly hit commuter lines around Leeds, where the company let 100 drivers take early redundancy. The problem is that while areas in West Yorkshire have been affected, the train operator has improved the service on other parts of the network.
This has meant that performance payments exceed the penalties for the cuts. For June, RRNE is entitled to a bonus of pounds 185,000 - more than five times the pounds 33,000 it faces in financial penalties for the cancellations.
The transport authority meets today to endorse the proposal, put forward by Cllr Lyons. Under rail privatisation, the authority pays pounds 47m a year for its local rail services, run by bus company MTL since March, and also administers performance payouts.
MTL has suffered from a lack of drivers on some routes. It also blames protracted negotiations with Aslef, the drivers' union, over a new wages and conditions package. A spokesman for MTL declined to comment.
However, rail industry insiders pointed out that the contract between the passenger authority and the private company are "legally binding". "It is not up to politicians to decide when and if these payments are made. The authority just has to pay them," said one expert.
Jonathan Bray, campaigns director for rail pressure group Save Our Railways, said that the cuts were inevitable as the sell-off was completed "on the basis of cost-reduction". "This was bound in the end to be passed onto the passenger," he added.
A busy commuter train company has bowed to widespread criticism and is reinstating some services it had planned to drop from its winter timetable.
Passenger groups had attacked the original decision by Connex South Central to run 70 fewer trains a day than it has operated this summer.
Yesterday Connex said it would now be keeping four of the axed trains on when the winter timetable starts on September 28.