Grant Shapps claims the country's economic centre of gravity is being pulled north as Anneliese Dodds says Budget 'didn't deliver' for region

The decision to base the new UK Infrastructure Bank in Leeds is proof that the country's "centre of gravity is being pulled northwards", according to Cabinet Minister Grant Shapps.

Transport Secretary Grant Shapps pictured last year in Leeds before lockdown restrictions were imposed.

Mr Shapps, who is Transport Secretary as well as Northern Powerhouse Minister, said the commitments made in Rishi Sunak's Budget this week "illustrate our longer term ambitions to empower the North and help the region build back better from Covid".

But the Chancellor's Labour counterpart Anneliese Dodds said his speech "failed to deliver for the North of England" and claimed the Richmond MP was not "really facing up to the challenges" the pandemic had posed to the region.

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Budget 2021: The 'most amazing' one yet or a disappointment? Yorkshire residents...

Mr Sunak unveiled a number of eye-catching announcements for Yorkshire and the North as he revealed plans to repair the nation’s finances by increasing the tax burden to the highest level in 50 years.

As well as the infrastructure bank based in Leeds, which "will invest across the UK in public and private projects to finance the green Industrial Revolution", a new northern campus of the Treasury will be set up in Darlington.

The Humber and Teesside will both host freeports, which have different rules making it easier to do business, as well as getting extra funding for port infrastructure to launch the next generation of offshore wind projects.

In a blog post this weekend, Mr Shapps wrote: "If anyone still doubted the Government’s determination to deliver on our promises to the North and level up the UK economy, then I hope this week’s Budget has persuaded them of our intent.

"We’ve already overseen a transformational shift in decision-making powers away from London to the North of England. By May, 60 per cent of the North will be represented by metro mayors, each of them advocates for their areas.

"That’s far more than any other region of the country. But the commitments made in this week’s Budget illustrate our longer term ambitions to empower the North and help the region build back better from Covid.

"Locating the important new UK Infrastructure Bank in Leeds is further evidence that the UK’s economic centre of gravity is being pulled northwards."

The Tory Minister added that: "After the devastating events of the past year, this was a Budget that laid the foundations for our economic recovery.

"But in contrast with the past, it also laid the foundations for a fairer, more balanced recovery, generated not just by the South East and London, but increasingly by the economic powerhouse that is the North of England."

During a virtual roundtable with local businesses in West Yorkshire, Shadow Chancellor Anneliese Dodds, denied the suggestion that the speech was a 'Budget for the North'.

She told The Yorkshire Post: "We didn't see the Chancellor really facing up to the challenges that the North's experienced during this Covid period.

"We know that it's been really difficult for lots of different areas with high levels of infection, they've had to make the money from Government stretch for much longer, because they've been under restrictions for much longer than lots of other parts of the country.

"There wasn't any recognition of that, unfortunately, from the Chancellor. It seems to me that they're focused on headline grabbing announcements, but the delivery so often has just not been there. It's been completely missing.

"And that's then been shown up, of course, in those 10 years where we have seen regional inequalities rising across a whole number of different indicators.

"Quite frankly, I would be delighted if the Conservative government decided that now was the time to be properly investing in the North, to be making sure that we see the kind of skills and training that is necessary supporting local businesses.

"No, they didn't provide more support for startup loans, for example, as we've called for, they did nothing about that, unfortunately. There's so much they could have been doing to support the North, and they chose not to, unfortunately. So this really was, I would say, quite a disappointing budget from that point of view."

Below is the full text of the op-ed by Transport Secretary Grant Shapps

If anyone still doubted the Government’s determination to deliver on our promises to the North and level up the UK economy, then I hope this week’s Budget has persuaded them of our intent. The measures announced by the Chancellor – including the first ever national Infrastructure Bank in Leeds, a major new base for the Treasury in Darlington, and three new Freeports in Humber, Liverpool and Teesside – signal a historic rebalancing of the UK’s economic geography.

We’ve already overseen a transformational shift in decision-making powers away from London to the North of England. By May, 60% of the North will be represented by metro mayors, each of them advocates for their areas. That’s far more than any other region of the country. But the commitments made in this week’s Budget illustrate our longer term ambitions to empower the North and help the region build back better from Covid.

Locating the important new UK Infrastructure Bank in Leeds is further evidence that the UK’s economic centre of gravity is being pulled northwards. Supporting more than £40 billion of infrastructure investment, the bank will finance both public and private schemes across the UK, with a special remit to help the UK reach its net zero carbon commitment by backing green initiatives, and taking equity stakes in the most promising projects. The new bank will open its doors this spring.

Meanwhile, I am delighted that Darlington was chosen as the location for ‘Treasury North’. Staffed by 750 senior civil servants, this is not just an office. It’s a significant part of the largest and most powerful department moving out of the capital, putting Northern people and businesses at the heart of Government. The move not only reflects Darlington’s excellent transport links, but also the need to focus investment and economic activity right across the Northern Powerhouse.

Earlier this week, the Prime Minister and the Chancellor were in Teesside, where a new Freeport will turbocharge the local economy and create thousands of jobs. Indeed, all three new Northern Freeports will become catalysts for economic growth, attracting new investment and creating opportunities in left behind communities and benefitting from fantastic new international trade opportunities.

In addition to a simplified customs process, our Freeports will offer tax measures to incentivise businesses to invest and carefully considered planning reforms to facilitate much-needed construction. There will be additional targeted funding for infrastructure improvements in Freeports to level up communities and boost job opportunities.

Levelling up is a key objective of the Freeports, and among the reasons why Humber, Liverpool and Teesside were chosen was their ability to bring economic opportunities to more deprived parts of the country. And to help progress the Prime Minister’s Ten Point Plan for a green industrial revolution, new port infrastructure will be built to support the next generation of offshore wind projects in both Teesside and Humberside.

Painting a picture of the future during his Budget speech, the Chancellor said: “I see old industrial sites in Teesside being used to capture carbon, vaccines being manufactured, off-shore wind turbines creating clean energy for the rest of the country, all located within a Freeport, with a Treasury just down the road, and the UK Infrastructure Bank only an hour away.”

Further announcements in the Budget included over £1 billion for more towns to benefit from the Towns Fund. For example, Castleford will now join the long list of Northern towns to receive substantial funding for regeneration. Northern mayors have received over £30 million to support planning and delivery of transport projects in advance of £4.2 billion for transport networks in city regions next year. Nearly £19 million was announced to transform cultural projects in four places, including Hartlepool, Carlisle and Wakefield in the North. And guidance was published for local areas helping them apply for a share of our £4.8 billion Levelling Up Fund.

Turning to my beat – transport – there is more good news. The Chancellor revealed a further £135 million to progress the vital A66 TransPennine upgrade. We are also taking further action to help the aviation industry which has been so badly affected by the pandemic, and to support regional airports in the North, which will be essential to the region’s recovery. The Budget renewed the Airports and Ground Operations Support Scheme for an extra six months from the start of 2021-22. This scheme will be open to eligible commercial airports and ground operators across the country, including in Northern England, and will provide support towards their fixed costs, saving up to half of their annual business rate liabilities, subject to certain conditions, and a cap per claimant of £4 million.

After the devastating events of the past year, this was a Budget that laid the foundations for our economic recovery. But in contrast with the past, it also laid the foundations for a fairer, more balanced recovery, generated not just by the South East and London, but increasingly by the economic powerhouse that is the North of England.