Govia Thameslink Railway (GTR) is facing a £5m fine for the chaos caused by the introduction of a new timetable last May, which led to train cancellations and delays for hundreds of thousands of commuters.

An investigation by the Office of Rail and Road (ORR) into the “severe disruption” identified several failures on the part of Govia, which operates the Thameslink, Great Northern, Southern and Gatwick Express franchises.

The watchdog said Govia failed to communicate changes to services, cancelling trains with short notice and leaving commuters unable to properly plan their journeys.

Stephanie Tobyn, the deputy director for consumers at the ORR, said: “The disruption experienced by many passengers as a result of the May timetable introduction was awful. When disruption happens, poor-quality information makes an already difficult and frustrating situation worse.”

Govia said it was disappointed by the fine and was considering its response. It has 21 days to respond to the penalty notice from the ORR.

The firm’s chief executive, Patrick Verwer, said: “The severe disruption following last May’s timetable introduction was due to industry-wide factors and we are sorry for the serious effect this had on our passengers.

“GTR has paid £18m in passenger compensation and is investing a further £15m in improvements for passengers for its part in the timetable issues.”

He said improvements included upgrades to station screens, issuing frontline staff with smartphones loaded with real-time service information, and having volunteer teams on standby to help passengers during disruption.

The company has held on to Britain’s biggest rail franchise, despite calls for it to be stripped of it, but in December was ordered by the Department of Transport to spend £15m on passenger improvements.

Andy McDonald MP, the shadow transport secretary, said the proposed fine was “only a slap on the wrist for Govia Thameslink”.

“Passengers endured years of abysmal services even before the timetable chaos and the company should have been stripped of its contract and banned from the railway. The fact that Govia Thameslink will continue to profit from passengers and [transport secretary] Chris Grayling remains in a job shows there is no accountability for failure on the railway.”

In the eight weeks after the timetable change on 20 May, trains were permanently removed from the timetable but passengers were not clearly informed this was the case until several weeks later, the watchdog said.

Some trains were reintroduced at short notice, leaving insufficient time to input journey information into systems. The ORR said these “ghost trains” arrived at stations with staff and passengers unaware of their arrival or where they were expected to stop.

In other cases, replacement buses were used on some routes but many passengers did not know about them and inadequate internal communication often left frontline staff with little or no information to assist passengers.

Tobyn said: “The exceptional circumstances that followed the introduction of the timetable meant that providing perfect advance information for passengers was from the outset an impossible task and GTR’s overriding focus was on providing as much capacity as it could to meet customer demand. However, persistent and prolonged failures in information provision meant that passengers couldn’t benefit from the operational improvement it was trying to make.”

The watchdog has written to all train companies and Network Rail asking them to review their crisis management plans.