IPPR urges government to adopt ‘North First’ infrastructure policy

8 Aug 16

The government should revise its infrastructure strategy to prioritise investment in the North of England in order to promote growth and prosperity, a think tank has said.

In an analysis published today, IPPR North revealed the south-east of England is due to receive six times more investment spending than the North. It urges the Treasury to redress the North-South imbalance immediately by overhauling the way it assesses value for money on infrastructure projects.

In the statement, the think-tank also urges the government to take advantage of record-low interest rates and raise £50bn in “catch-up cash”, to pump into road and rail infrastructure in the North.

This would, it said, unlock the vital private and foreign investment that such schemes would ultimately need, and enable Theresa May to achieve her stated aim of boosting the UK’s industrial capacity.

According to the think tank, spending on infrastructure is six times greater in the South East than in the North of England, per person. Over the next four years, the North East will receive £300 per person, the North West £290, Yorkshire and Humber £250, and London £1,900 for key infrastructure.

The figures are based on an analysis of the government’s infrastructure pipeline, combined with ONS data on population and commuter numbers.

The think tank highlights that Crossrail will cost £4.6bn during this period, and that this project alone will exceed spending on all projects in the North (£4.3bn). It stresses that a new east-west cross-Pennine train line should take priority over HS2 and Crossrail 2, in order to unite Northern cities and promote prosperity in the region.

The North of England is especially well placed to benefit from increased infrastructure spending, the think tank said because of the significant leaps in productivity can be achieved if Northern cities are more closely connected. Also, the North has significant “non-city strengths”, such as ports, energy assets and national parks, which would also be boosted for greater connectivity.

A revised methodology for determining infrastructure spending was needed, he review concluded, because the current “seriously flawed” methodology was not geared up for driving industrial growth.

The think tank also said 10-year budgets would enable more effective long-term planning.

IPPR North director Ed Cox said: “To build Theresa May’s ‘Better Britain’, we must focus on a better North. The North of England’s £300bn economy is worth more than those of Scotland, Wales and Northern Ireland combined. Focusing on this is going to be crucial in over the coming years.

“The North must also “take control” of its own funding decisions. The evidence shows that this would help to boost growth, ditching the Treasury’s outdated and ineffective model, better suited to mitigating congestion than driving new economic growth.”

Tom Kibasi, director of IPPR in London, agreed and called the outdated infrastructure that links regional cities in the UK a “national disgrace.”

He said: “This is just not what happens in Germany, Japan or France, with their fantastic rail links, or the United States, with its highly developed regional air travel.

“Given the Brexit result, the North of England must urgently see growing prosperity,” he said. “A proper east-west crossing would boost northern and UK growth, and must now take priority above all other major transport projects, including Crossrail 2 and HS2.”

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