Transport Secretary Chris Grayling has come out fighting in the row about a north-south divide in Government spending between the regions.
Mr Grayling faced a barrage of criticism in the summer after announcing Government backing for multi-billion pound investments for London and the south east amid cuts for the north.
Greater Manchester Mayor Andy Burnham and a host of other leaders from Leeds, Liverpool, Sheffield and Newcastle, complained northern commuters were still using "clapped out trains" while London was being lavished with cash.
But in a speech to business leaders in Manchester on Friday Mr Grayling said after "decades of under-investment" he was "baffled" by his Labour critics, who he took with a pinch of salt.
Mr Grayling also took aim at the media and think tank the Institute of Public Policy Research (North) which claimed spending per head was vastly higher in the south.
He said: "I want to slay some of the myths around this. Some of the stuff that's been said in the last months is absolutely not true.
"You have been hearing about us spending more in the south than the north. I want to take that head on. The figures you have heard completely misunderstands the nature of spending and the nature of the figures."
Mr Grayling said when local transport schemes were taken into account spending per person was actually higher in the north west than the south east.
The Transport Secretary sparked anger in July by supporting a new £30 billion Crossrail 2 scheme in London and the south east days after a series of rail electrification projects in Wales, the midlands and the north were axed or downgraded.
He suggested "bi-modal" trains, powered by both electricity and diesel, may be the answer in the north. Critics say electric trains are cleaner, greener and faster.
It left a question mark over electrification of the Transpennine route between Leeds and Manchester, seen as key infrastructure for the Northern Powerhouse project of improving the northern economy.
On Friday Mr Grayling repeated, twice, that no announcement or decision had been made about electrification of the Transpennine route but went on to say "hybrid cars"' were now running on the roads and new technology meant "hybrid trains" could provide solutions.
He said: "'Let me give you one statistic on that. Since 2010 at a time of financial challenge, we have electrified something like four times as many miles of railway in the north west as the last government did in 13 years across the entire country.
"We have launched the biggest modernisation programme of railways in the north since the steam age.
"I have been somewhat baffled by the accusations coming from our Labour opponents.
"They are the ones actually doing the planning work for Northern Powerhouse Rail, the commitment for the north that was in our manifesto, I'm waiting for Transport for the North to tell me where they think we should begin that project, what the priorities should be, what it should look like.
"So I'm very happy to stand up and be counted on our record for transport for the north.
"But the fact is between 1997 and 2010, the transport system in the north didn't exactly move forward at pace.
"So I do take with a pinch of salt those who accuse us of not doing anything when I look around and think, look at all the things we are doing now that were not happening then."
However Ed Cox, director of IPPR North, said it stood by its research, Mr Grayling was simply wrong on the facts and it was unclear where he had obtained his figures.
Mr Cox said using the Government's own figures, if the North had received the same funding as London over the past 10 years, the region would have received £10 billion more and there was a £1,500 spending "gap", with £1,900 of government spending per head in London, compared with £400 per head in the North.
He added: "He's wrong. He's actually wrong about historical spending.
"Mr Grayling needs to be more specific about what he's referring to.
"If there is so much discussion around this, we would be happy for this matter to be referred to the Office for National Statistics."
Mr Grayling was in Manchester to announce the allocation of £5 million for digital signalling on the rail line between York and Manchester.
This represents 1.1% of the £450 million fund for digital railway development announced in the Autumn Statement last year.