1. Transport
  2. Rail
July 28, 2016

England's north should achieve its Powerhouse Rail under its own steam

By Duncan Sim

Poor transport infrastructure is widely recognised as a major barrier to the ambition to create a “Northern Powerhouse”. If the North of England is to realise its full potential to drive forward the regional and national economies, for the benefit of local people and the UK as a whole, then connectivity must be improved, both within individual cities but also between the north’s major centres of population.

Both Transport for the North and the National Infrastructure Commission have argued this point persuasively. Central government recognises this, too, and the chancellor accepted the recommendations made in the National Infrastructure Commission’s High Speed North report in the 2016 budget. The same budget also saw funds allocated to upgrade rail links between Manchester and Leeds – an important first step towards the “Northern Powerhouse Rail” network connecting Liverpool, Manchester, Leeds, Sheffield, Newcastle and Hull.

But it is surely intrinsic to the idea of a “powerhouse” that it is driven by its own momentum, rather than by external forces. The powerhouse project cannot simply be something done to the north, in which it is merely a passive beneficiary. Rather than being seen through the lens of national politics, local people and local leaders must feel they have ownership of the powerhouse agenda.

This means local politicians must be able to realise local priorities, and that conversations around these priorities must not be dominated by the national context. In short: local leaders must have the authority, powers, and resources to act in the interests of the powerhouse and its aims as they see them – and not be reliant on Westminster’s approval.

It was a collection of local city regions that first began to force the issue of Northern urban connectivity with the publication of the One North proposition in August 2014. This group now forms the basis of the membership of Transport for the North, and this document the basis of its remit. So while government has accepted northern urban connectivity as a national-level concern, it remains first and foremost a local question, and a local priority.

The implication of this is that local leaders in the north should be empowered to address this question of connectivity themselves. Having placed northern transport investment on the agenda, these leaders must now ensure that they are at the heart of conversations over not just the route plans for improved connectivity, but also the timing and practical delivery of those plans.

It is local leaders who are best-placed to judge the transport improvements which will most benefit their constituents and their locales. It is they – not national politicians – who must have primary responsibility to take forward these improvements.

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The very rationale for devolution should be based on the recognition that calling on the local knowledge of local stakeholders will lead to better outcomes than can be achieved from the top down. Yet central government remains in the driving seat, in sole possession of the powers and the resources to implement transport investment on this scale.

ResPublica’s February 2016 report Ticket to Ride called for the Liverpool City Region to be given control of employer National Insurance contributions in the region, in addition to business rates; and for this revenue to be used as the basis for a Tax Increment Financing scheme to capitalise local infrastructure investment. Specifically, given mayor Joe Anderson’s stated ambition for the city to be included in the HS2 network in the interests of its future prosperity, we argued that this mechanism could raise up to half of the cost of the new infrastructure which would be required to achieve this.

Although this mechanism entails the local region spending the same money which Whitehall would have had to have spent anyway, this is more than just a fiscal sleight of hand. The implication is that national government accepts the prerogative of the local area to determine and act upon its own interests.

At a broad level, this would represent an important shift in both culture and accountability. Local areas would no longer have to justify their priorities to Whitehall. Instead, they could get on with making the investments they judge to be most needed in their area, and take responsibility for those judgements at local elections. And with regard to transport investment specifically, with government paralysed for the foreseeable future by the EU referendum result, this move could considerably shorten the timescales for delivery of vital new infrastructure.

Perhaps most importantly, however, tying the delivery of Northern Powerhouse rail network to the devolution of the appropriate planning and fiscal powers in this way would lend credence and substance to the concept of a self-confident and dynamic north. This is a concept which is just as important as physical infrastructure to the vision of a Northern Powerhouse.

Duncan Sim is transport lead at the think tank ResPublica.

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