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The Elizabeth Line is a red rag to northern bulls starved of investment
The Elizabeth Line now accounts for one in six of all rail journeys made in the UK according to data published last week. That is a remarkable statistic. Before last May the line didn’t even exist.
But there are mixed feelings about the Elizabeth Line. “It’s beautiful,” says Chris Oglesby, the chief executive of Bruntwood, one of the largest property developers in northern England. “But it’s an absolute disgrace.”
I spoke to Oglesby in Manchester on Wednesday, the day of the budget, along with other business leaders in the city. There was a buzz around Manchester. But that was more to do with Manchester City beating RB Leipzig 7-0 the evening before and Snoop Dogg being in town for a gig than anything Jeremy Hunt said.
Oglesby is frustrated about the Elizabeth Line because there has not been similar investment in the ageing transport network in northern England. The budget offered little indication that it is on the way.
I have been travelling around the UK over the past year speaking to business leaders and local politicians about the progress of levelling up and the economy outside London. Despite the prevailing narrative of doom and gloom there is a sense of optimism — particularly in cities. Tech investment in the UK was £24 billion in 2022, by far the most in Europe and the third most in the world, according to a report by Dealroom. Much of this was in promising start-ups. London accounts for most of the investment but Manchester, Oxford and Bristol have also emerged as tech hubs.
Productivity in UK cities outside London still lags the capital dramatically, as well as other big cities in Europe. One way to look at this graph is to bemoan the UK’s failings. But another way to look at it is that there is an obvious and incredible opportunity for the UK to boost its economy by unlocking the underutilised capacity outside London. One FTSE 100 chief executive said to me last week that productivity in their UK facilities is the same as the rest of Europe when the investment is the same. In other words, the UK’s productivity issues are about investment.
However, while there is optimism, there is also a sense that an opportunity is being wasted.
A common complaint is that levelling up is too broad as a policy and full of compromises. Hunt said in his budget speech that nearly £4 billion has been allocated to projects by the Levelling-Up Fund. But there are more than 200 projects. Each should deliver a welcome boost to their local economy — many of them involve regenerating a struggling area — but they do not tackle inherent structural issues in the economy.
One way to make levelling up more focused would be to anchor it around a smaller collection of key projects that could deliver wider benefits. Connecting the cities of northern England is one. A recent report by the Harvard Kennedy School said one of the keys to levelling up the UK was more investment in regional transport in “highly congested urban areas with potential to benefit from agglomeration economies”.
This is why there is frustration in the north. What is needed seems obvious. Instead, northern England is left with an ageing transpennine rail network, a problem exacerbated by a wave of last-minute cancellations in recent months. Meanwhile proposals for a Northern Powerhouse Rail remain stuck in the long-grass and HS2 has been delayed again. Heck, even improving the abysmal wi-fi on trains so people can work more effectively while travelling would be a step forward.
The Treasury questions whether these projects can offer value for money. But as the Elizabeth Line shows, build it and they will come.
Graham Ruddick writes the Off to Lunch newsletter at offtolunch.substack.com and was previously deputy business editor of The Times
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