Northern businesses ‘bruised’ by blow to rail investment, warns CBI chief

Northern businesses are “upset” and “bruised” at the Government’s move to scrap HS2’s Eastern leg and cut back the much-vaunted Northern Powerhouse project, the head of the CBI has said. Tony Danker, the director general, also called on ministers to extend an olive branch to areas such as Bradford most affected by the diminished integrated rail plan unveiled last week, dealing a blow to the Government’s levelling up ambitions. Mr Danker said: “Talking to members of that part of the world in the last 24 hours, they are very upset.

And I think that the issue speaking to them was less about connectivity to London. It’s more about connectivity across the North, and multiplying the amount of places in the North that can participate in economic activity.  “I just hope the Government will go and talk to those communities and business communities about how to move on from here, because I think they’re feeling a bit bruised today.”

He added: “The Government needs to respond properly to those sort of cross-North capacity issues. And I think that if that has been inadequately addressed… they need to get around the table with these folks pretty soon.” The Prime Minister has defended its transport plans as “biggest investment in rail at least for 100 years” at GBP96bn.

But the document scraps the eastern leg of HS2 linking the West Midlands and Leeds[1] while plans for a new line between Manchester and Leeds – a key plank of Northern Powerhouse Rail – have also been abandoned in favour of cheaper upgrades of existing assets.

HS2 routes of the eastern leg scrapped[2]

Mr Danker, who was speaking on the eve of the CBI’s annual conference, will say today that Britain is in danger of becoming a “branch line” economy where “the most productive parts of a sector – such as HQs – are all too often based in London and the South East, and the branch managers and the back office based everywhere else”. The CBI chief said the organisation would establish a new “Centre for Thriving Regions” to help private businesses engage with the Government in levelling up left-behind regions.  He said: “Instead of a branch-line economy what we want is an economy of many hubs.

That means using all parts of the country to their full potential.

In a multi-hub economy, clean energy headquarters in the North East call up London to arrange finance.

And London companies like TfL call up Yorkshire, Ballymena and Falkirk for green buses.”

References

  1. ^ scraps the eastern leg of HS2 linking the West Midlands and Leeds (www.telegraph.co.uk)
  2. ^ HS2 routes of the eastern leg scrapped (cf-particle-html.eip.telegraph.co.uk)




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