Transport and the Economy

Lindsay Hoyle Excerpts

Tuesday 28th February 2012 Commons Chamber

[Several hon. Members]

rose—

[Mr Deputy Speaker (Mr Lindsay Hoyle)]

Order. I understand that this debate is important, but if we want to get everybody in, we will unfortunately have to drop the time limit to six minutes.

--- Later in debate ---

[Jonathan Ashworth]

rose—

[Mr Deputy Speaker]

Order. Before the hon. Gentleman answers, let me remind hon. Members that the idea behind imposing a time limit is to get everybody in. He is well placed, but every time there is an intervention, that adds another minute, which means that somebody else will drop off the bottom.

--- Later in debate ---

[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—

[Mr Deputy Speaker (Mr Lindsay Hoyle)]

Order.

--- Later in debate ---

[Angela Smith]

That illustrates my point about the need to have clear plans for economic development in place alongside plans for transport investment.

The report is also important because it points out very clearly that there is a lack of transparency and consistency in the decision-making process at the Department for Transport. Finally, it is important because it points out that the removal of regional structures created by the last Government risks creating a vacuum in effective planning for transport infrastructure.

I want to focus particularly on the report’s recognition that the Government should produce a White Paper explaining explicitly how their plans for transport investment will be linked to their plans for the economy more generally, and in particular explaining their plans for rebalancing the UK economy. Rebalancing is important not just to the economic development of areas such as the north-west and Yorkshire but to the whole country, including London and the greater south-east.

We need transport investment to maximise the potential for a more dynamic set of relationships between economies across the country. HS2 is a case in point. According to The Northern Way, its potential impact of £13 billion would deliver at least £3 billion of economic impact to the north. The point is, however, that its economic impact will affect the whole country, and therefore potentially benefits everyone.

What do we need if we are to rebalance the economy in transport terms? I believe that we need three things. First, we need more transparency and greater consistency in decision making, so that we can hold the Government to account in relation to their stated aim of rebalancing the economy. Secondly, we need political bravery: we need to use investment to maximise economic development in areas such as the north of England, and to remove barriers to growth in those areas. Thirdly, we urgently need to know more about how the Government will develop sub-regional, regional and even cross-regional structures enabling them to produce sound, well-thought-out strategies for the delivery of transport infrastructure.

The removal of the regional development agencies and, by definition, The Northern Way group of RDAs, has left a vacuum in regional planning, especially—as the report points out—in the context of their role in supporting regional economies. Moreover, the local enterprise partnerships have not been thought through. How will these new structures working at sub-regional and city-regional level work structurally across LEP boundaries to deliver what our regions need?

The north of England is a perfect example. As a result of The Northern Way and its superb work in developing arguments and strategies relating to transport, the case for the northern hub has been clearly made and accepted even by the coalition Government. The northern hub is needed, of course, to tackle congestion on the northern rail network, thereby helping to remove barriers to economic growth; but it is also needed in the context of the decision to go ahead with HS2. It is important that we deliver both projects in order not just to reduce congestion on the network but, as I mentioned earlier, to maximise the potential benefit of HS2.

If we are to maximise the potential of HS2 to make the relationship between the economies of the north and London more dynamic, we must also ensure that those agglomeration benefits are spread across the north. If that is to happen, the Government must recognise the importance of transport infrastructure in supporting economic development plans. In particular, they must recognise our great northern cities as hubs for economic development. They must recognise the importance of greater connectivity—not only with London, on a north-south axis, but on an east-west axis, between the northern urban centres, and with international gateways not just at Heathrow and Gatwick but at the mouth of the Humber and Mersey rivers.

We need regional planning. As the report says, without it there will be a risk that choices will be made on a basis that discriminates against weaker economies. There is already an example of that in the form of the Government’s decision to electrify the Leeds-to-Manchester cross-Pennine route, which discriminates against what I call the third point of the golden triangle of the north: the city of Sheffield.

We need the Govt to recognise the broader context of an economic policy that involves stimulation of the economy and the role that transport could play in it. Long-term infrastructure projects should be brought forward, as outlined in Labour's alternative plan for jobs and growth, but instead we are seeing significant cuts in investment, such as the £759 million cut on top of the £528 million efficiency savings supported by Labour.

We also need the Government to recognise the spending disparity between the north and the south. The Passenger Transport Executive Group has produced some interesting figures. In 2010-11, transport spending per head was £774 in London and £276 in Yorkshire and the Humber. The source of those figures is the most recent version of a public expenditure spending analysis from Her Majesty’s Treasury. I ask the Minister to respond to them, and to demonstrate by way of a full written explanation—

[Mr Deputy Speaker (Mr Lindsay Hoyle)]

Order. I call Stuart Andrew.