The Times, 10 December 2015,
Tourists are always asking: can you direct us to the Northern Powerhouse? And the honest answer is no chance, mate — and not just because it’s north of Watford. It’s because it’s a figment of the chancellor’s imagination.
So, how nice to see one of George Osborne’s cabinet colleagues admitting as much with his award of two rail franchises: one to a state-owned German outfit, dressed up as Arriva, the other to FirstGroup. The pair are ready to deliver “a world class rail service that would make the Northern Powerhouse a reality”. Or so said transport secretary Patrick McLoughlin, immediately dispatching a junior minister, Andrew Jones, up north to unfurl a Northern Powerhouse banner — before putting it back in his bag.
There you have it, then. The whole powerhouse thing’s basically a flag. So it’s dead lucky everyone was so distracted by the shock of FirstGroup actually winning a rail franchise: TransPennine Express. True, winning slightly overstates things, what with the transport group having run it already for 11 years. But at least it’s not another loss, the main forte lately of chief executive Tim O’Toole, who lost Thameslink, ScotRail and the Caledonian sleeper while failing to replace them with the East Coast or vomit comet (Essex Thameside).
Astonishingly, it’s First’s first win since 2012’s West Coast bid fiasco — and now, instead of getting a subsidy to run TransPennine, it’ll have to make £400 million of premium payments and invest £500 million by 2023. That will produce the new trains to increase capacity by 55 per cent between the likes of Manchester, Leeds and Sheffield — enough, First reckons, to maintain the pace of passenger growth, up from 13 million to 28 million since 2004. Better, First won’t have to share profits with its former partner, France’s Keolis, which switched sides to bid with Go-Ahead and lost.
Anyway, it was enough to lift First shares 1 per cent to nearly 104¼p, still a bit below the 119p ex-rights price where the group raised £615 million in 2013. But at least First had a better day than rival Stagecoach, which lost the TransPennine bid, pulled out of the one for East Anglia and tried to blame Isis for its rubbish figures, so getting a deserved 14 per cent share price spanking.
As for Mr Osborne’s pet project, think-tank IPPR North reckons “between £15 billion and £65 billion is required to transform the north’s transport infrastructure”. What’s a gap of £50 billion, except, of course, lots of Northern Powerhouse flags.