Will McLoughlin’s rail investment pause kill Osborne’s Northern Powerhouse dream?

Lawrie Quinn
01 July 2015

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Northern Powerhouse

Last week’s announcement by Transport Secretary Patrick McLoughlin to halt and review large parts of Network Rail's electrification programme has shocked and disappointed the rail industry. But could it turn out to be a wise move, asks Lawrie Quinn?

On the 15th June Railways Minister, Claire Perry reminded an optimistic Railway Engineers Forum (REF) that less than three weeks earlier Chancellor George Osborne had travelled to Manchester to give his first speech of his second term. 

At the heart of this journey, was promotion of his pet northern powerhouse project, she reminded the Forum, reiterating that the Chancellor’s ambition was to close the decades-old economic gap between north and south by, among other things, making a record investment in northern transport projects. 

"It is a missed opportunity likely to set back confidence in the rail sector by a least a decade."

At the REF meeting Perry called for partnership with the UK’s rail freight companies to ensure private investment in freight locomotives wagons complemented the £38bn national infrastructure investment programme for the passenger network focused on the Government’s historic plans for railway electrification.

She also pointed to the Conservative election manifesto commitment to electrify the main northern rail network routes as part of a £13bn strategy to modernise the North of England’s creaking transport systems.  

This key offer to the voters in marginal seats beyond Birmingham pointed to economic renewal and to rebalance national wealth creation beyond the over heated London & the South East. 

In the north of England so far as the electorate, the railways customers and key regional politicians were concerned, that plan was entirely on track. 

In fact as recently as last Wednesday, a meeting of Transport for the North board, a body set up last year to develop pan-northern connections to forge a single northern English economic area, discussed just this issue.

One day later, our friends in the north suddenly started getting calls about an announcement from the transport secretary, Patrick McLoughlin, of a “pause” on key electrification projects on the important TransPennine route between Manchester and Leeds, as well as the Midland mainline from London to Sheffield. 

"McLoughlin’s decision is seen a big blow to the ambitions of building a northern powerhouse, with everyone agreeing  that what we need in the north is better connectivity across the Pennines."

And so the announcement came. The north, it seem was losing out to the south, once again, with McLoughlin declaring the electrification of the Great Western line from London to Bristol “a top priority”.

Recent days have heard members of the Railway Engineers Forum express frustration that the Secretary of State’s announcement, coming just a week after their successful debate with the railway minister, had so clearly exposed HM Treasury’s “northern powerhouse” strategy as empty rhetoric. 

It is a missed opportunity likely to set back confidence in the rail sector by a least a decade.

The emerging dialogue across both the national and technical media has reinforced this sense of disappointment across railway leaders and infrastructure professionals within REF’s community . 

McLoughlin’s decision is seen a big blow to the ambitions of building a northern powerhouse, with everyone agreeing  that what we need in the north is better connectivity across the Pennines. 

Put simply you can’t hope to rebalance the economy without the north getting the investment it needs. 

Feasibility studies have shown that electrifying that one route would create 7,000 new jobs. Thus when it comes to northern transport projects it has been a real shock to many in REF to hear that once again that HM Treasury has in effect ruled on the question “the North: is it really worth it?” – not least given the Chancellor’s vocal support for this investment approach.

"It all sounds a bit vague. No “how” or “when”. No firm financial commitment. Just a claim that “we are working with businesses and cities in the north to make that happen.”"

With around 86% of all transport infrastructure spending currently deployed in London and the south-east, the feeling of most Northerners is that “the rest of us are fighting over the crumbs”. 

It is understood and hard to answer.

The REF has long believed that Transport connections and infrastructure must be the foundation on which a prosperous economy is built. Since, the North already loses out substantially when it comes to public investment in its dated, poorly integrated and underfunded transport network. 

Now it seems obvious we will see projects already too far back in the queue fall further behind, which will further hamper the area’s ability to grow and compete.

So is it fair to ask whether McLoughlin’s pause will be permanent? 

Based on his unclear statement to parliament, he made no promises about the Midlands mainline, but said the government needed to be “much more ambitious” about the TransPennine service. A “fast, high-capacity TransPennine electric route” would be built, he suggested, as part of the “powerhouse for the north”.

It all sounds a bit vague. No “how” or “when”. No firm financial commitment. Just a claim that “we are working with businesses and cities in the north to make that happen.”

That said, although many of REF’s members are naturally disappointed with last week’s electrification announcement, most rail professionals will be pragmatic about the set back - as long as it’s a short pause and not a halt.

"Together we need to analyse how we can push the restart button for the wider rail electrification programme, deliver the next generation of rail professional leaders and engineers"

Some in the wider transport community think McLoughlin may actually be making a very sensible decision for the long term. Operationally railway electrification alone doesn’t create much extra capacity. 

To create the capacity and shorten journey times, really you have to address other, bigger issues, such as adding new track and new signalling. Electrification was never really a game-changer for connectivity and capacity.

The railway community, like the travelling public, needs to see the details. But it may be a wise decision to put these projects on ice, given the potentially limited effect, in favour of one big bang which could deliver the speeds and capacity needed for the future.

So the Railway Engineers Forum stands ready to engage with all the politicians and bean counters. 

Together we need to analyse how we can push the restart button for the wider rail electrification programme, deliver the next generation of rail professional leaders and engineers.

Most importantly the emerging events of the last few days must avoid this becoming a bodyblow to the confidence of those who previously were convinced by the need to kickstart a much needed rail renaissance in the nation’s economic interests.

Lawrie Quinn is the outgoing chairman of the Railway Engineer’s Forum and former MP for Scarborough and Whitby (1997-2005).