Transport and the Economy

Debate between John Leech and Fiona Mactaggart

Tuesday 28th February 2012 Commons Chamber

[Mr John Leech (Manchester, Withington) (LD)]

I should like to begin by congratulating the hon. Member for Liverpool, Riverside (Mrs Ellman), the Chair of our Select Committee, on securing this debate and opening it this afternoon. The contributions so far have been varied, covering a wide range of transport issues from up and down the country. I want to concentrate on the specific elements of the Committee’s “Transport and the economy” report that deal with the role of transport in rebalancing the economy.

During this time of economic uncertainty, transport must be a key factor in stimulating growth. To their credit, the coalition Government have learned from the mistakes made by previous Governments during economic downturns and prioritised investment in transport infrastructure. While other Departments saw an average reduction in capital expenditure of 29%, the transport capital programme was reduced by only 11%, with Treasury forecasts that by 2014-15 capital investment would be higher in real terms than it was in 2005-06. This has meant that a number of capital schemes have been able to go ahead that would almost certainly have faced the axe in previous economic downturns.

As a northern MP representing south Manchester, I welcome the Government’s commitment to economic rebalancing and reducing the north-south divide. This received a cautious welcome, I would say, in the Select Committee report. Transport funding has consistently favoured London and the south-east to the detriment of areas of the north and the south-west. If we are to see a rebalancing of the economy, this needs to be reflected in current and future transport funding.

[Fiona Mactaggart (Slough) (Lab)]

On that issue, I share the view of the hon. Member for Wimbledon (Stephen Hammond) that some projects in the south are essential to UK inward investment. More specifically, I would say that Heathrow is the only hub airport in Europe that does not have a rail link to its immediate hinterland. It has one to London, but nothing to the Thames valley, which is the most productive area for inward investment in the UK and is obviously essential to get growth in Britain.

[Mr Leech]

I thank the hon. Lady for that intervention. It is fair to say that the Government have prioritised some schemes in London and the south-east—the Crossrail project, for instance, which has received an enormous amount of money. Other parts of the country have certainly received significantly less funding over a long period.

There are some encouraging signs, however. In Manchester, rail capacity and journey times will benefit greatly from the additional electrification work, including that of the TransPennine Express, and the funding for the Ordsall chord. Congestion will be eased with the completion of the airport link road—a scheme for which my hon. Friends the Members for Cheadle (Mark Hunter) and for Hazel Grove (Andrew Stunell) have been campaigning for many years. Metrolink extensions have also been given the green light and are under construction, including within my constituency.

From a Manchester perspective, two projects hold the key to whether the Government’s commitment to rebalancing the economy will be followed through to its conclusion. The first is high-speed rail, and the second and more urgent is the funding for the northern hub, which I am sure the Under-Secretary of State for Transport, my hon. Friend the Member for Lewes (Norman Baker), will be sick of me raising with him on so many occasions.

The debate about high-speed rail will drag on, with supporters and opponents making arguments and counter-arguments about whether the real economic benefits are predominantly for London and the south-east. However, what cannot be disputed is the fact that the north will see the greatest possible level of benefit only once high-speed rail reaches Manchester and Leeds. I welcome the Government’s commitment to the next phase of the high-speed rail network, but I want to know what the Government are doing about bringing forward the timetable, so that we do not have to wait another 20 years before we reap the full benefits.

I recognise that for once the Government are looking towards our transport needs for the next 100 years rather than for the next 10 years, but we need to do more to bring forward the time scale so that the regions can benefit as soon as humanly possible.

From Manchester’s perspective, however, the real test for the Government will be whether or not funding will be forthcoming for the northern hub. With £80 million already secured for the Ordsall chord, the complete hub scheme will cost only £560 million in total—and possibly less, given that some elements of the project are already included in other committed individual schemes. We should compare this to the billions of pounds that the Government have committed for Crossrail.

In a Westminster Hall debate in January, the hon. Member for Blackley and Broughton (Graham Stringer), who is not in his place this afternoon, calculated that three months of Crossrail payments would pay for the whole of the northern hub. I am not sure how accurate the hon. Gentleman’s maths is, but it certainly puts into perspective the difference in funding levels for the two schemes. At a cost-benefit ratio of 4:1, with an estimated 20,000 to 30,000 new jobs and a £4 billion boost to the economy, the northern hub is the opportunity for the Government to show their commitment to rebalancing the economy.

I questioned the Minister of State, Department for Transport during the Select Committee inquiry, and she said that the northern hub

“must be a really strong contender for support in the next railway funding settlement control period.”

She went on to confirm the Government’s intention to try to close the prosperity gap between the regions, saying:

“One of the ways in which we could do that is by targeting our transport spending on projects which will generate growth in different regions.”

Well, I could not agree more. If the Government are serious about economic rebalancing, they need to confirm the funding for the northern hub, and not just in a piecemeal way. The Government need to come up with all the cash in control period 5.

In the short time left, I should like briefly to raise two other issues mentioned in our report. The first relates to the dependence of transport priorities on local circumstances. A one-size-fits-all or a Government-know-best approach will not work. In line with the coalition Government’s localism agenda, there needs to be more local determination of what works in each local area. National Government is not well placed to decide what is best for an individual area and what will best support economic growth. Metrolink has been a massive success in Manchester, driving economic growth and stimulating regeneration to areas such as Salford Quays and Eccles, as well as encouraging modal shift in areas such as my constituency.

The need for local decision making was reflected in the report’s conclusions—