Paul Stephen
Transport for the North has published its long-awaited setting out a 30-year vision for northern transport, but can central government be persuaded to back its £70 billion funding requirement? PAUL STEPHEN investigates
“This makes delivering on the STP just as much about contributing to the success of the UK as a whole, as opposed to viewing the investment through the narrow prism of addressing regional inequalities.”
POLITICS has always been a brutal business. But perhaps never more so than at the present time, as the Government’s protracted attempts to secure a Brexit deal with the European Union continue to divide Westminster.
With time fast running out to avert a ‘no deal’ scenario on March 29, and no obvious majority emerging among MPs for just about any course of alternative action, the faith of businesses and the wider electorate in the UK’s long-established political processes is being sorely tested.
It was therefore refreshing to be treated to a rare display of political unity on February 11, as elected representatives and business leaders from across northern England gathered in Sheffield for the launch of Transport for the North’s Strategic Transport Plan (STP).
The 170-page document forms the sub-national transport body’s statutory advice to government on future priorities for investment in northern transport infrastructure ( RAIL 873). And its unanimous approval by TfN’s local authority members forms a powerful reminder that party lines and political dogma can occasionally be set aside in order to work in the collective interest.
The prize on offer for this panregional co-operation is significant, with an opportunity (according to TfN) to secure £100 billion in economic growth, 4% higher productivity, and an additional 850,000 jobs by 2050.
It is hardly surprising therefore that northern leaders - including the respective mayors of Greater Manchester and the Liverpool and Sheffield City Regions - have been queuing up to evangelise about the virtues of TfN’s plan.
But the harsh reality is that this will only go so far in delivering the economic and social transformations that it seeks to achieve. The fight must now be taken to Westminster, where government ministers will have the final say on whether to provide the £70bn needed to put it into action.
The early signs from the two main political parties have so far been encouraging, however, with both Rail Minister Andrew Jones and Shadow Transport Secretary Andy McDonald heaping praise on TfN at its Sheffield event.
With both men representing northern constituencies, delegates heard impassioned speeches on how the case for change was not merely an academic exercise for consideration in the remote bubble of Westminster, but part of a personal crusade to reverse several decades of perceived underinvestment.
Jones bolstered this message by citing some £13bn worth of investment already committed by government to improving northern transport until 2020 - including bigticket items such as a new Metro fleet for Tyne and Wear (£337 million) plus Network Rail’s TransPennine Route Upgrade (£2.9bn).
According to Jones, this will push transport spending in the North above that of London and the South over the next three years, in terms of per head of population.
He also offered some hope that decisions on the Northern Powerhouse Rail project, which lies at the heart of the Strategic Transport Plan, will be made in the next year - for possible inclusion when legislation for HS2 Phase 2b is finally laid before Parliament.
Meanwhile, McDonald spoke of Labour’s flagship (although as yet undefined) policy to invest £10bn in a ‘Crossrail for the North’ suite of enhancements, to upgrade eastwest rail connections.
He added that investment in northern connectivity would also be prioritised over southern England, as part of his party’s plans to create a £500bn National Investment Bank.
Of course, beyond these loose or existing commitments, neither man was in a position to give TfN’s plan a more explicit thumbs-up.
And with Brexit continuing to suffocate domestic policy-making, and with question marks remaining over the long-term stability of the current administration, solid pledges of support will just have to play second fiddle to short-term point-scoring for the time being.
But as sure as night follows day, Brexit will inevitably come to dominate the past rather than the present, freeing politicians to properly consider the STP and the statutory advice that TfN has presented within it.
But what exactly are they being asked to buy into? And how likely is it to translate into cold, hard cash?
Behind the headline-grabbing £70bn price tag lies an impressive evidence-based and independently verified piece of work that took several years in the making.
And unlike standalone projects (including HS2 and Crossrail), the £70bn is not being sought by TfN as a single well-defined funding envelope, but has instead been staggered to form a long investment pipeline of individual schemes categorised as short, medium or long-term priorities for completion between 2020 and 2050.
Spreading out payments and the allocation of funding in this way is likely to make TfN’s proposals more palatable to the Treasury. It should also help to avoid some of the problems encountered by Crossrail (and perhaps HS2), where costs have needed to be updated several years after fixed budgets had been set.
More than half of this investment is due to be spent on rail, with £39bn earmarked for Northern Powerhouse Rail, and smaller amounts for further schemes within TfN’s Long Term Rail Strategy. The remainder seems destined for road schemes, improving multimodal integration and the rollout of smart ticketing.
It’s also debatable whether the final cost is in fact £70bn at all, with TfN estimating that a much lower figure of £21bn-£27bn is actually needed once existing or projected spending commitments (via agencies including Highways England and Network Rail) are taken into account.
This ‘additional’ expenditure amounts to £700m-£900m per year, which equates to £150 per northern citizen (or 43p per day).
TfN has been careful to avoid the trap of framing the argument for additional expenditure in the emotive but simplistic language of ‘North versus South’, and correcting the historical disparity that has persisted in transport spending per head.
Instead, with the northern economy currently worth some £343bn per year, it argues that the extra money would bring strategic transport infrastructure spending closer to the 1.2% of GDP level recommended by the National Infrastructure Commission, and benchmarked against other countries.
When thought of in these terms, it seems difficult to find much at fault with TfN’s own description of this uplift in spending as “ambitious but realistic”.
However, one limitation of the plan that has been readily noted by TfN is the low potential for private investment, to reduce the burden on centrally sourced funding.
Current attempts to introduce privately funded and/or delivered infrastructure, such as the planned East West Rail route between Oxford and Cambridge, would inevitably be more difficult to replicate in the North, where land value capture for developers is much lower.
The Department for Transport’s recent call for market-led proposals might offer a better route, with a number of large movers of freight (including Drax power station) showing interest in a range of reopening schemes such as Skipton-Colne.
Of course, the proof of the pudding is always in the eating, and TfN should not have to wait long to find out how receptive government is to its plans.
A review of the initial programme is pencilled in for later in the year as part of the Comprehensive Spending Review, while TfN has also said it will update the STP in 2022, by which time the political outlook at a national level should hopefully be much clearer.
However much of the STP is eventually adopted by government, a ‘business as usual’ scenario certainly looks like the least likely outcome. After all, if northern England was a country it would already be the 27th largest in the world in economic terms.
This makes delivering on the STP just as much about contributing to the success of the UK as a whole, as opposed to viewing the investment through the narrow prism of addressing regional inequalities.
And with Brexit almost upon us, surely that is something we can all agree on? R
■ TfN’s Strategic Transport Plan and Long Term Rail Strategy can be accessed on the TfN website.