Bernard Ginns: Shale gas could have a seismic effect on our economy

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IS shale gas really the panacea to all our problems?

According to increasing numbers of commentators, it is.

Andrew Neil, the journalist, publisher and broadcaster, used his address at Variety’s Yorkshire Business Awards to espouse the potential of the natural gas, which is trapped within shale formations.

In a powerful speech, the Scot told an audience of business leaders how changing geopolitics threaten to leave Britain isolated in the world without American support and dependent on Saudi oil and Russian gas.

Shale gas has transformed America’s fortunes, he argued, leading to a revival of the chemicals, plastics, iron, aluminium, steel, rubber, metal and glass industries as cheaper energy costs suddenly make old business models viable again. “This phenomenon has a name in the United States, it is called the Homecoming; industries are returning to the United States,” he said.

Britain, with diminishing military ability to defend key trade routes, needs to get its act together, said Mr Neil, not unreasonably.

“Politicians need to start arguing about things that matter; for example, a proper energy policy that makes us energy independent as well,” he said.

“Last time I looked there was around 5 trillion cubic feet of shale gas under Morecambe Bay. A policy that changes the whole balance of power in Britain from the over-populated, over-important South, back to the North of England again – that’s what would matter to our country.”

Rabble-rousing stuff indeed. Mr Neil would surely have made an effective politician.

But more caution, less haste on shale gas please. Not enough is really known about the consequences of its extraction, despite the clean bill of health from our Government.

Coalition ministers have a vested interest remember: the economy is struggling and they will do anything to achieve some semblance of growth before the election campaign starts in earnest.

Even if it means triggering potentially ruinous seismic activity.

More conducive to the revival of the North as a force to be reckoned with would be a functioning and efficient railway system that helps business people travel around quickly and conveniently.

Ward Hadaway, the top-100 law firm, has offices in Manchester and Leeds alongside its head office in Newcastle.

The firm’s stated aim is to be “a northern law firm for national business” and much of its work cuts across the North’s major population centres.

Jamie Martin, the managing partner, believes the current train service across the Pennines is “not cut out” for doing business in the 21st century.

He said: “If we are to generate more business between the great cities of the North and to create growth across the region we clearly need a better transport system and, particularly, a better train service.

“It seems to make little sense that the distance between Newcastle and London is almost twice that between Newcastle and Manchester yet the train journeys take nearly the same amount of time.

“Trans-Pennine trains also tend to be smaller than normal inter-city services; they are invariably very crowded, offer limited refreshment facilities and often seem to run late.

“A regular express service through Yorkshire linking the North East with the North West and stopping at the major cities en route would make a real difference to doing business across the North.

“If funding can be found for HS2 and for Crossrail in London, transport investment like this in the North should be a priority for a Government committed to rebalancing the UK economy.”

Mr Martin is not alone. It was only last week that Tony Walsh, the managing director of Barclays’ £6bn corporate banking business in the North, was bemoaning the desperately inadequate transport links.

“The sooner they sort out the M62 the better,” said Mr Walsh, whose jobs involves spending hours sat on the trans-Pennine motorway.

“In this country to get from north to south is okay. To get from east to west is an absolute nightmare.

“My biggest office is in Manchester. I’m there at least once a week. I can get to Newcastle quicker than I can get to Manchester.”

He has welcomed recent announcements of further infrastructure spending, but said more needs to be done. Of course it does.

The problem is that ministers exist in a Westminster bubble with minimal recourse to the real world outside.