The Northern Way: Manchester Hub Conditional Output Statement

The Northern Way: Manchester Hub Conditional Output Statement

The Northern Way: Manchester Hub Conditional Output Statement

The Northern Way: Manchester Hub Conditional Output Statement April 2009

The Northern Way: Manchester Hub Conditional Output Statement

ii Manchester Hub Conditional Output Statement

The Northern Way: Manchester Hub Conditional Output Statement

Manchester Hub Conditional Output Statement Executive Summary 1 Part 1:The Conditional Outputs 7 Part 2:The Evidence Base for the Economic Case for Enhancing Manchester Hub Capacity and Capability 13 Part 3:Disaggregated Rates of Benefit 33 Part 4:Stakeholder Aspirations 45 Part 5:Overview Of Approach To Modelling 49 Glossary 73 Contents Text and design by Steer Davies Gleave

The Northern Way: Manchester Hub Conditional Output Statement
The Northern Way: Manchester Hub Conditional Output Statement

Manchester Hub Conditional Output Statement 01 Executive Summary Context The Manchester Hub is the network of rail corridors that link and cross in and around central Manchester.

The Northern Way has identified the Hub as the most fundamental rail bottleneck in the North of England. It limits the capacity, performance and connectivity of commuter and longer distance passenger services that either terminate in Manchester or pass through the Hub. It therefore adversely affects journeys between the North’s city regions too. It also limits the number of trains, from across the North and beyond, that can serve Manchester Airport, the North’s principal airport, as well as that can access important distribution centres for freight.

On 4th October 2007, the then Department for Transport Minister of State, Rosie Winterton, responding to the work of the Northern Way, announced that a study would be undertaken to develop proposals to enhance the capacity and functionality of the Manchester Hub. The Manchester Hub Study is being undertaken in two phases overseen by a Department for Transport-chaired Sponsors’ Group, the other members being the Northern Way, Greater Manchester Integrated Transport Authority and Passenger Transport Executive, and Network Rail. The Sponsors’ Group asked that the Northern Way lead the Phase 1 study.

The Phase 2 work is being led by Network Rail. Producing the Manchester Hub Conditional Output Statement has been the primary purpose of the Phase 1 study and it is set out in this report.

The Outputs are described as conditional because their realisation depends on it being found possible to devise solutions which are both affordable and represent value for money. The Phase 2 work is focussing on the development of alternative rail options to meet the Conditional Output Statement and then their assessment from an operational, financial and economic perspective. The Phase 2 study will involve more detailed demand modelling work than Phase 1 (although using the same overall structure), as well as engineering assessment. The Conditional Output Statement The Conditional Output Statement for the Manchester Hub sets out the question that Network Rail, in collaboration with industry colleagues, will attempt to answer.

It seeks to define the problem in a clear way. The Conditional Output Statement is made up of five parts.

Part 1 of the Conditional Output Statement is a summary of the conditional outputs, numerically cross- referenced to the evidence base and results of the Phase 1 modelling which are presented in subsequent sections of this document. It is important to stress that the conditional outputs have been derived from a combination of the evidence base set out in Part 2 and the outputs of the modelling work. The conditional outputs also reflect the Northern Way’s established position that the North’s economic growth needs to be environmentally sustainable and in particular the importance of the North contributing to the national effort to tackle climate change.

In Part 2 of this Conditional Output Statement, the emphasis is entirely on the evidence base, and specifically, the economic evidence base. Stakeholder views and requirements (other than some specific needs of Department for Transport) are not included in Part 2, but are summarised separately in Part 4.

The Northern Way: Manchester Hub Conditional Output Statement

2 Manchester Hub Conditional Output Statement Part 3 provides further information that has informed the development of the conditional outputs. It comprises a summary of the modelling tests carried out by the Northern Way to examine a package of candidate rail service improvements across the Manchester Hub and on the rail corridors leading to it.

These results have been expressed in a user-friendly format by setting out the value of economic benefits. in each corridor, and expressing the results on a £ benefit/unit change basis. The specific assumptions that lie behind these test results are important in that they reflect a plausible set of incremental improvements which were developed from consideration of stakeholder requirements. By expressing the economic value to be gained on the £ benefit/unit change basis, the Part 3 analysis has a relevance that can be applied across a wide range of scenarios that Network Rail may wish to consider in Phase 2.

As already noted, Part 4 gives an overview of the Northern Way’s consultation with high level stakeholders from across the North. This, along with the conclusions of a stakeholder workshop held in July 2008, led to the definition of four objectives for the Hub Study. Part 4 shows how meeting the conditional outputs set out in Part 1 will contribute to meeting the stakeholder objectives. Part 5 is a summary of the modelling methodology that has been applied. More detailed technical reports on the Phase 1 economic forecasting that has been undertaken by Experian and Steer Davies Gleave’s modelling and appraisal work have been published separately by the Northern Way and are available on our website.

Rail Corridors To support the development the Conditional Output Statement, the Northern Way has defined 14 rail corridors, each of which converge on the Manchester Hub. These corridors have been used to disaggregate the forecasts of future demand and potential benefits set out in Parts 3 and 5. They have also been used in the specification of a number of the Conditional Outputs, which are set out in Part 1. The corridors are listed in Table 1 and shown geographically on Map 1. Map 1 Manchester Hub Corridors

The Northern Way: Manchester Hub Conditional Output Statement

Manchester Hub Conditional Output Statement 03 1 Southport via Wigan 2 Preston and the North via Bolton 3 Blackburn 4 Bradford via Rochdale 5 Yorkshire and the Humber & the North East via Leeds 6 Glossop / Hadfield 7 Marple / Romiley 8 Yorkshire and the Humber & the East Midlands via Sheffield 9 Buxton 10 London, Birmingham and the South (via WCML) 11 Manchester Airport 12 Chester via Northwich 13 Liverpool via Irlam (CLC) 14 Liverpool / Chester via Warrington (Chat Moss) Key Findings There is an extensive evidence base about how the economic performance of the North is affected by transport links in general and rail links in particular.

Evidence shows that to support economic growth there needs to be adequate capacity, and that journeys can be made reliably and with reasonable journey times: within city regions; ● ● between city regions; and ● ● to access international gateways. ● ● It shows that within city regions there remains scope to connect areas of economic need with areas of economic growth. Not all city regions are equally well connected. Facilitating economic growth may require provision of new links to provide new capacity and capability. It shows the key role that rail has to play in delivering economic growth.

In themselves, the modelling tests undertaken by the Northern Way reveal some key pointers on the scale of the economic benefit from the Manchester Hub. Two demand growth scenarios have been considered. In the Trend scenario we have assumed that the North’s economy grows in line with the Department for Transport’s standard appraisal assumptions. In the Trend Plus scenario we have assumed that the North’s regions and city regions successfully deliver their economic development plans, which results in the North’s economy growing at a faster rate. A Test Timetable has been used to assess the potential level of benefit from Hub enhancement.

This Test Timetable is a plausible set of incremental enhancements to journey times and service frequencies together with potential inter-connections between passenger services on each of the rail corridors that converge in the Manchester Hub.

The most significant finding from this new work is simply this: in a scenario with Trend growth a package of plausible incremental service enhancements to commuter and longer distance passengers services offering greater connectivity to and across central Manchester brings overall economic benefits of £12.7bn (PV over the life of the project). In the Trend Plus scenario these benefits increase to £16.2bn PV. This indicates that Manchester Hub is a challenge worth devoting considerable resources to tackling, whether or not the Trend or Trend Plus projections are used as a basis for the Phase 2 work.

It is also clear that the distribution of benefits is widely spread: Manchester Hub is not about one or two key flows. Instead, we observe that growth prospects are highest on south Manchester local commuter markets, whilst the greatest rates of benefits are on the main corridors linking the Table 1 Manchester Hub Corridors

The Northern Way: Manchester Hub Conditional Output Statement

Manchester Hub Conditional Output Statement 04 adjacent city regions to Manchester. There are also very significant benefits related to West Coast Main Line services to London and in the railfreight sector. Manchester Hub is about solving a problem that affects the development of national, regional and local rail services, about freight and passenger services. The scale of benefits on offer suggests that it will be right to consider radical as well as incremental solutions. Some of the key results are summarised in the panel below. Whether or not appropriate measures and schemes can be developed to secure this range and type of benefit will depend on what emerges from Network Rail’s work ahead.

Until then, the Outputs are described as conditional because their realisation depends on it being found possible to devise solutions which are both affordable and represent value for money.

Within the North, commuter and inter-urban services on the five corridors to Yorkshire ● ● and the Humber and North East via Leeds, Preston and the North via Bolton, Yorkshire and the Humber and East Midlands via Sheffield and the two to Liverpool dominate rail demand on services that use the Manchester Hub. The West Coast Main Line Corridor to the south is the largest of all. In the Trend and Trend Plus scenarios these corridors provide the largest ● ● quantity of forecast growth. In the Trend and Trend Plus scenarios the fastest ● ● rate of growth is projected to occur on corridors where commuting to Manchester is the dominant flow.

The corridors to Marple/Romiley, Buxton and Manchester Airport corridors have the highest rates of growth in the Trend scenario. In the Trend Plus scenario, the corridors to Bradford via Rochdale, Marple/Romiley and Buxton have the highest growth rates. In the Trend and Trend Plus scenarios the greatest level of incremental benefit per unit ● ● of generalised journey time improvement is in the following corridors: London, Birmingham and the South (via WCML) ● ● Yorkshire and the Humber & North East via Leeds ● ● Preston and the North via Bolton ● ● Yorkshire and the Humber & East Midlands via Sheffield ● ● Manchester Airport ● ● In the Trend scenario the greatest level of incremental benefit per unit increase of ● ● capacity is in the following corridors: Yorkshire and the Humber & East Midlands via Sheffield ● ● London, Birmingham and the South (via WCML) ● ● Preston and the North via Bolton ● ● Yorkshire and the Humber & North East via Leeds ● ● Liverpool via Irlam ● ● In the Trend Plus scenario the Leeds and Preston corridors are reversed in this ● ● ranking.

Summary of key results

The Northern Way: Manchester Hub Conditional Output Statement

Manchester Hub Conditional Output Statement 05 What is clear, however, is that the preferred way forward needs to support the growth of rail commuting and business travel into central Manchester, the most significant location of employment in the North’s largest city region. It needs to support enhanced connectivity between the North’s city regions and between the North and the rest of the country. It needs to support the growth of Manchester Airport by increasing rail’s mode share as the airport grows. Finally, it needs to support the growth in inter-modal containers, both for established markets and by facilitating new markets too.

Stakeholder Engagement As we have already noted, high level consultation with stakeholders from across the North led to the definition of four objectives for the Manchester Hub study. These were discussed and confirmed at a stakeholder meeting held on 29th July 2008. This meeting also furthered our understanding of what stakeholders see as problems and issues around the Manchester Hub, as well as their aspirations for the future. The discussions at the stakeholder meeting helped inform the package of service improvements that was tested by the modelling work and helped inform the specification of the conditional outputs.

Reports on the high level consultation exercise and the July 2008 stakeholder group can be downloaded from the Northern Way’s website (www.thenorthernway.co.uk). Prior to the finalisation of the conditional outputs set out in Part 1 of this report, a second stakeholder meeting was held on 18th March 2009. The then draft conditional outputs were presented to that meeting and were broadly endorsed by the attendees. The conditional outputs have also been endorsed by the Northern Way Steering Group and the Northern Transport Compact.

The Northern Way: Manchester Hub Conditional Output Statement

6 Manchester Hub Conditional Output Statement

Manchester Hub Conditional Output Statement 07 The Northern Way has identified 10 conditional outputs that Network Rail, in collaboration with industry colleagues, should seek to meet when developing and then identifying the way forward for the Manchester Hub. These relate to: Capacity and Flexibility 1. Carbon Reduction 2. Performance 3. Journey Times 4. Growth Centres in Greater 5. Manchester Connectivity to Deliver Economic 6. Benefits Manchester Airport 7. Trans Pennine 8. North South Links and High Speed 9.

Rail Freight 10.

1. Capacity and Flexibility Future growth in demand has 1.1 been projected on the basis of detailed studies of population and employment trends and the application of demand models consistent with Department for Transport (DfT) standard econometric inputs and rail forecasting methods. In the Trend scenario it is assumed that the North’s economy grows in line with the Department for Transport’s standard appraisal assumptions. In the Trend Plus scenario it is assumed that the North’s three regions and eight city regions successfully deliver their development plans, which results in the North’s economy growing at a faster rate.

The growth in demand should be 1.2 taken as the central requirement in terms of capacity. In general, growth of between 39% (Trend) and 54% (Trend Plus) can be expected by 2020. Of course, service enhancements arising from the Hub solutions are likely to increase demand further. Differential growth rates are forecast on each corridor, with typically the shorter distance suburban corridors having higher average growth rates and the longer distance corridors showing the greatest amounts of growth. Adequate capacity needs to be 1.3 provided to accommodate Trend growth to 2019/20 in longer distance, commuting and other local rail journeys, with average crowding being no greater than implied by the capacity metrics for 2013/14 for Manchester in the Department for Transport’s 2007 High Level Output Statement for the rail industry1 .

For the Trend scenario after 1.4 2019/20 and in relation to the Trend Plus scenario, the identified Manchester Hub proposal should be ‘future- proofed’ to accommodate these higher growth rates without a requirement for further major infrastructure works beyond the identified proposals but through measures such as train lengthening. It is important to note that these 1.5 demand projections do not fully take into account the economic recession. In practice, this may be taken as having a delay impact on projections of demand growth.

[Part 2 References: 5, 6, 14, 15, 16, 20, 22, 24, 25, 26, 27, 28, 34] {Part 3: Tables 1 and 2 above are from the analysis described in Part 3, also Paragraph 3.8} {Part 5: Tables 4 and 5} 1 Appendix A to Delivering a Sustainable Railway Cm 7176, July 2007 The Conditional Outputs Part 1: Note: The number in square brackets [ ] at the end of each Conditional Output refers to documents cited in Part 2 and included in the Part 2 list of references.

Paragraph and table references shown in curly brackets { } identify the relevant sourcing available from the results of the modelling work summarised in Part 3, and in the case of growth, Part 5. These form the evidence-base for the inclusion of each Conditional Output within the overall Conditional Output Statement.

Manchester Hub Conditional Output Statement 08 2.Carbon Reduction The net effect of the Manchester 1.6 Hub proposals on the overall carbon trajectory for the transport sector which in due course will be adopted by Government should be demonstrated. If possible, the effect of Manchester Hub in terms of in-service operation should be to contribute to the trajectory of reduced carbon emissions as set in national level overall targets for the transport sector.2 [Part 2 References: 8, 27, 28] 3.Performance Network performance should be 1.7 such that delay minutes on franchised services in the Manchester area will not be worsened by meeting the Manchester Hub Conditional Outputs and that the performance of franchised rail services in the Manchester area is kept consistent with the High Level Output Statement and in line with targets set nationally.

In respect of Airport services, as the available evidence is that good reliability and performance is of particular significance to encourage rail use by airline passengers, the conditional requirement is to improve performance further as a priority.

[Part 2 References: 5, 6, 9, 14, 15, 16, 20, 22, 24, 25, 26, 27, 28, 34, 41] 2  Besides taking account of consequences for carbon emissions from changes to the pattern and density of rail services (diesel and electric) arising from the Manchester Hub, it would be appropriate to take into account carbon savings from diversion of demand away from more carbon-intensive travel modes. It is not considered appropriate at this stage to set a carbon target related to construction phases (although this may follow subsequently as a matter of good practice).

4. Journey Times In addition, the evidence is that 1.8 for the economies of the northern city regions to function effectively together, they need to be provided with much speedier inter-connections.

There are no absolute cut-offs or thresholds which define acceptability for the key journey times: quicker still, will always be advantageous. However, based on the need to 1.9 achieve regular interval city centre to city centre times that are recognisably faster than by car, and adopting 60 miles per hour as a benchmark, these are target journey times for the key corridors, from a Manchester City Centre station (either Victoria or Piccadilly) to the principal adjoining city regions3 : Leeds 40 minutes ● ● 4 (and Bradford 50 minutes, recognising route characteristics) Sheffield 40 minutes ● ● Chester 40 minutes ● ● Liverpool 30 minutes ● ● Preston 30 minutes.

● ● It is also of course the case that 1.10 the economic and other benefits of commuting and other local trip making by rail are increased by reducing overall journey times, a function of station to station times, service frequency and wider accessibility considerations. [Part 2 References: 1, 5, 6, 14, 15, 16, 19, 22, 24, 25, 26, 27, 28, 34] {Part 3: Tables 1-6} 3  Typical off-peak journey times from Manchester Piccadilly are Leeds 55 minutes, Sheffield 48 minutes, Chester 63 minutes, Liverpool 52 minutes, Preston 42 minutes; and from Manchester Victoria, Bradford 69 minutes In the 2007 Rail White Paper, the Department for Transport committed to reduce the Leeds journey time to 43 minutes and the Liverpool journey time to 40 minutes 4  Assuming dwell times at Leeds and York are also minimised, this would give journey times to Newcastle, Middlesbrough and Hull of 133, 124 and 101 minutes respectively.

Manchester Hub Conditional Output Statement 09 5.Growth Centres in Greater Manchester To support the growth and 1.11 regeneration of the Manchester/Salford Regional Centre, from each principal rail corridor5 to each sub-area6 within the Regional Centre there should be either: a direct rail service; or ● ● a service that requires no more than ● ● a single interchange for onward travel by rail, Metrolink or Metroshuttle. To support growth elsewhere in 1.12 Greater Manchester, from each principal rail corridor to each of the key town centres7 , there should be either: a direct rail service; or ● ● a service that requires no more ● ● than a single interchange, by rail or Metrolink.

To support growth outside the 1.13 Regional Centre, from each principal rail corridor to Salford Quays there should be a service that requires no more than a single interchange by bus or Metrolink. Recognising that the development 1.14 and then promotion of Metrolink options is a matter for the Greater Manchester authorities rather than Network Rail, the future role of Metrolink tram-train conversions should be taken as being 5  Corridor 2 (serving Preston), Corridor 4 (serving Bradford/Halifax); Corridor 5 (serving Newcastle/ Tees Valley/Hull/Leeds); Corridor 8 (serving Sheffield, South Humber Bank and the East Midlands); Corridor 10 (serving London/ Birmingham); Corridor 13 (serving Liverpool), Corridor 14 (serving Chester/North Wales and Liverpool); together with Corridor 11 serving Manchester Airport 6  The Regional Centre comprises the following sub- area: Central Business District, Retail Core, Eastern Gateway, Piccadilly Gateway, Oxford Road Corridor, Spinningfields, Chapel Street, Victoria, Northern Quarter, Southern Gateway, The Village, Petersfield, Castlefield, Left Bank and Chinatown.

Plans for the physical and transport development of these quarters are set out within the 2008 draft Regional Centre Transport Strategy.

7  These are defined in the Local Transport Plan and are Ashton-under-Lyne, Oldham, Rochdale, Bury, Bolton, Wigan, Altrincham and Stockport ‘in scope’ for the Phase 2 work. Similarly, while the development and promotion of bus links is also a matter for the Greater Manchester authorities, the Phase 2 work will need to be mindful of such opportunities. [Part 2 References: 5, 14, 20] {Part 3: Tables 1, 2, 4, 5} 6.Connectivity to Deliver Economic Benefits8 All principal corridors 1.15 9 to be connected if possible to the same station in Manchester City Centre for easy passenger transfer (or through cross-Manchester operation), as well as other central area stations appropriate to the travel market.

The economic analysis 1.16 undertaken for this project shows that cross-city movements deliver significant incremental unit benefits which in some cases are greater than those from point to point improvements on existing services. The improved connectivity should therefore be used: (a) where possible, to promote direct cross-city movements (for which train service provision and hence franchising costs will also generally experience cost efficiencies), or (b) where this cannot be done, to facilitate convenient passenger 8  The evidence from the economic analysis is that the greatest rates of benefit can stem from improvement in cross-city connectivity.

These journeys have a more strongly competitive road- based alternative given the more dispersed trip pattern and the existence of the complete orbital motorway at Manchester. Northern Way’s analysis [33] shows that road congestion across the North is going to worsen, even with smarter choices, the application of the Highway Agency’s Managed Motorways approach and Intelligent Transport Systems and therefore there is a need to provide a non-congested alternative suitable for high value business use. In addition, there is a need to encourage spillover effects from the key growth centres in the city regions to secondary centres where the economy is most sluggish [1,10].

This means an improvement to links such as those between places north of Manchester to the prosperous band of greater job opportunity on the south side of Manchester, for example. 9 As defined in footnote 5

10 Manchester Hub Conditional Output Statement interchange. This is best done at a single Manchester City Centre station to avoid circuitous, time consuming/ counter-intuitive routeing. [Part 2 References: 2, 3, 5, 6, 14, 15, 16, 20, 22, 26, 27, 28, 31, 32, 34, 35, 36] {Part 3: Tables 2, 5}10 7.Manchester Airport To allow the expansion of the 1.17 Airport to its airside capacity so that it can fulfil its wider potential to support the growth of the Northern economy, it will be necessary to maximise rail mode share on existing corridors and expand the set of major rail destinations directly accessible from the Airport to increase overall rail mode share of surface access trips.

As well as destinations across the North, account needs to be taken of the potential to improve links from the Airport to North Wales and the West and North Midlands.

The requirement is for direct 1.18 11 services of at least hourly interval service frequency in each of the principal corridors12 (30 minutes in the case of the Yorkshire and the Humber and North East via Leeds corridor) on a 7 day/week basis with service start and finish time giving 95% of air passengers the option of using rail for their inbound and outbound legs connecting the Airport with each of the Northern city regions. Services should share in the journey time gains (as in Output 4) and performance gains (as specified in Output 3).

[Part 2 References: 5, 8, 9, 10, 13, 14, 16, 17, 18, 19, 24, 26, 27, 28, 30, 34, 41, 42] {Part 3: Tables 2, 5 – line 11} 10  See “To Other Manchester Hub Corridors” columns in these tables.

11  With recognition given to longer term stakeholder ambitions for no interchange en route and in the case of Corridors 8 and 10, direct services to the Airport without the need to pass through central Manchester. 12 As defined in footnote 5 8.Trans Pennine Overall The three Trans Pennine corridors 1.19 form the spine for City Region to City Region links across the North to and from Liverpool and Central Lancashire in the west through to Tyne and Wear, Tees Valley and Hull and the Humber in the east. To support a high frequency, high quality, regular interval core express service that links all of the Northern City Regions in a way designed to maximise the number of direct city region to city region linkages, and meeting the enhanced journey times and performance targets (Conditional Outputs 3 and 4).

Leeds – Manchester With a 15 minute interval service (or better) Sheffield – Manchester With a 20 minute service interval Bradford/Halifax – Manchester With a 30 minute service interval [Part 2 References: 5, 6, 7, 14, 16, 20, 25, 26, 27, 28, 34, 36, 40] {Part 3: Tables 3, 6} 9.North South Links and High Speed Rail To meet forecasts and 1.20 requirements13 for a doubling of West Coast Main Line demand by 2026 and with such provision as indicated as being appropriate by the National Networks Strategy Group, to accommodate High Speed 2 (HS2) options to and beyond central Manchester, together with a possible parkway station.

[Part 2 References: 5, 6, 8, 14, 20, 26, 27, 28] {Part 3: Table 7} 13  In terms of capacity at terminals and access/ egress capacity, and to meet journey time and performance requirements as set out in the DfT West Coast Strategy and as advised in due course by DfT in relation to HSR/West Coast relief line in respect of such issues as train length and route electrification.

11 Manchester Hub Conditional Output Statement The Northern Way’s Strategic Direction for Transport identifies that to support economic growth of the North there needs to be adequate capacity, so that journeys can be made reliably and with reasonable journey times for links within city regions, between city regions and to access international gateways.

Meeting the Conditional Outputs will contribute to meeting these needs by: Within Manchester City Region ● ● Providing capacity for commuting (Output 1) ● ● Which is reliable and punctual (Output 3) ● ● And has attractive journey times and frequencies (Output 4) ● ● Serving range of destinations in the City Region (Output 5) ● ● Offering connectivity to interchange to other rail services (Output 6) ● ● Between City Regions ● ● Providing capacity for longer distance trips (Output 1) ● ● Which is reliable and punctual (Output 3) ● ● And has attractive journey times and frequencies (Output 4) ● ● Enhances city regions to city regions connectivity (Output 6) particularly on the key trans ● ● Pennine corridor (Output 8) and north south links (Output 9) To international gateways ● ● Enhances rail access across the North to Manchester Airport (Output 7) ● ● Supports growth in inter-modal rail freight (Output 10) ● ● Underpinning the Northern Way’s Strategic Direction for Transport is the need for the North to contribute to the national effort to tackle climate change through the development of a low carbon transport system (Output 2) 10.Freight Provision for a doubling of 1.21 freight tonnage from existing and new origins and destinations to/from the multi-modal terminals at Trafford Park and elsewhere in the North West by 203014 .

[Part 2 References: 21, 24, 27, 26, 27, 28, 37] {Part 3: Paragraph 3.10} 14  As per DfT Rail White Paper Delivering a Sustainable Railway Cm 7176, July 2007

12 Manchester Hub Conditional Output Statement

13 Manchester Hub Conditional Output Statement Introduction There is extensive evidence on how 2.1 the economic performance of the North is affected by transport links in general and rail links in particular. There is also evidence on the specific economic case for investment in the Manchester Hub. This evidence is the subject of Part 2.

It should be recognised that 2.2 the relationship between transport investment and economic growth has been the subject of much research over many years and that while our understanding of this inter-relationship may be improving, there is always scope to argue both the generalities and the specifics of particular pieces of evidence.

Of course, promoting the 2.3 economy is not the only objective of the Government’s transport agenda which also includes environmental considerations (including carbon) and quality of life issues. Equally, the Manchester Hub is not the only transport intervention that will facilitate economic growth in the North, although stakeholders across the North have agreed it to be the most important challenge facing the rail network of the North. Regions, City Regions and the Economy As part of the 2007 Comprehensive 2.4 Spending Review, the Government set out its vision for the performance of the English regions: “The Government’s central economic objective is to raise the rate of sustainable growth and achieve rising prosperity and a better quality of life, with economic and employment opportunities for all.

Unfulfilled economic potential must be released to increase the long-term growth rate of the UK. The Government’s vision is that every region in England should perform to its full potential and become more competitive in an increasingly global economy.” (HMT, 2007:3) The importance of the contribution 2.5 of the Britain’s city regions to regional and national economic prosperity has become widely recognised. They are the drivers of economic growth, which means that the economic growth of our cities, regional economic growth and economic growth of the country as a whole are inextricably linked.

Consequently in recent years supporting the sustainable economic growth of cities has become a centrepiece of urban and transport policy (ODPM (2000), Northern Way (2004), Eddington (2006), Parkinson (2006a), Parkinson (2006b), Department for Transport (DfT) (2007)). However, it is also well established that the North’s city regions while making a substantial contribution to the national economy, on a per capita basis under perform the national average and city region economies in the South East. The North’s city regions are not meeting their full potential (Parkinson (2006a)). The Evidence Base for the Part 2: Economic Case for Enhancing Manchester Hub Capacity and Capability City region economies drive regional and national growth.

The North’s city regions perform below the national average and are not meeting their full potential. The Government has set out its vision that each region should perform to its full economic potential.

14 Manchester Hub Conditional Output Statement Connectivity and the Economy Eddington (2006) argued that the 2.6 UK is already well connected and that the key economic challenge is to improve the performance of the existing network. He argued that to meet its economic goals of supporting sustainable growth Government should prioritise “action on those parts of the system where networks are critical in supporting economic growth and that there are clear signals that these networks are not performing” (Eddington (2006:6)). To Eddington, this means concentrating on the capacity and performance of existing links.

However, while arguing that the nation is broadly well connected, he recognised that there could be a case for “the addition of new links to support the growth and performance of the labour market in growing and congested urban areas” (Eddington (2006:13)). This led to a policy prescription from Eddington consistent with the position that the Northern Way reached in its earlier 2004 Growth Strategy, namely that: “[t]he strategic economic priorities for transport policy should be: congested and growing urban areas and their catchments; together with key inter- urban corridors and key international gateways that are showing signs of increasing congestion and unreliability.” Eddington (2006:32) This policy prescription has since 2.7 been endorsed by the Department for Transport in its Towards a Sustainable Transport System (DfT, 2007), its response to the Eddington and Stern reports and more recently in Delivering a Sustainable Transport System (DfT, 2008a), in which the Department sets out its processes towards developing an expenditure plan for the period 2014 to 2019 within the context of a longer term sustainable transport strategy.

Covering both the economy and the Government’s wider agenda, the Department has set its goals for the transport system to be: “ ● ● to support national economic competitiveness and growth, by delivering reliable and efficient transport networks; to reduce transport’s emissions of ● ● carbon dioxide and other greenhouse gases, with the desired outcome of tackling climate change; to contribute to better safety, security ● ● and health and longer life expectancy by reducing the risk of death, injury or illness arising from transport, and by promoting travel modes that are beneficial to health; to promote greater equality of ● ● opportunity for all citizens, with the desired outcome of achieving a fairer society; and to improve quality of life for transport ● ● users and non-transport users, and to promote a healthy natural environment.” DfT (2008a:7) The Department also helpfully 2.8 restates Eddington’s conclusion that the connectivity of the nation’s transport network is good is a “broad generalistion” but “it is not equally true for all cities” (DfT (2008a:21)).

It is recognised that there may be a need to develop new links as well as enhance the capacity and performance of existing ones.

To support economic growth there needs to be adequate capacity, so that journeys can be made reliably and with reasonable journey times: within city regions; ● ● between city regions; and ● ● to access international ● ● gateways. Not all city regions are equally well connected. Facilitating economic growth may require provision of new links to provide new capacity and capability.

15 Manchester Hub Conditional Output Statement Connectivity and the North’s City Regions The Northern Way (2004) in its 2.9 Growth Strategy identifies a number of reasons why there is a differential economic performance between the North and the South, and between the city regions of the North.

Each is strongly influenced by the historic legacy of the Northern economy which was largely dependent on manufacturing and extractive industries, but has since the 1970s experienced a significant shift away from these traditional industries to a more service-based economy (although manufacturing remains an important industry in the North). The goal of the Northern Way is to help address the underperformance of the North’s economy as a whole by promoting the accelerated growth of the North’s eight city regions15 . To this end, the Northern Way Growth Strategy identifies the importance of enhancing the North’s skill base, supporting the development of a more entrepreneurial culture, supporting greater innovation by firms in the North, promoting more sustainable communities, raising the international profile of the North and enhancing the North’s connectivity.

The Northern Way Growth 2.10 Strategy echoes the findings of others that while good connectivity alone is not a sufficient condition to support economic growth it is a necessary one. Similar conclusions were made by Parkinson et al (2006a, 2006b) and Institute of Political and Economic Governance (IPEG) et al (2008), who in particular found that, “whilst it is not an absolute truth to claim that places become economically successful because they are well connected, [we] found powerful evidence of correspondence between the two” (IPEG (2008:18)).

15  These are: Liverpool, Manchester, Central Lancashire, Sheffield, Leeds, Hull and the Humber, Tees Valley and Tyne and Wear. While pre-dating Eddington, 2.11 with regard to connectivity the Growth Strategy identified a policy prescription almost identical to that later piece of work, namely: enhancing links within the North’s ● ● city regions, particularly by public transport enhancing links between the North’s ● ● city regions, notably the Leeds Manchester corridor enhancing links to port and airport ● ● international gateways, both in the North and elsewhere in the UK Enhancing connectivity within the North’s city regions, between the North’s city regions and to international gateways is an integral part of the Northern Way’s Growth Strategy to accelerate the North’s economic growth.

There is good evidence to support this contention. Connectivity between the North’s City Regions Ensuring appropriate and 2.12 adequate connectivity within and between city regions, and to and from international gateways is an integral part of the policy prescription from Eddington and in their response to Eddington, the approach adopted by the Department for Transport. Looking at the North overall, the Northern Way has identified that existing connectivity between the North’s city regions is seen as an impediment to maximising the rate of economic growth in the North.

16 Manchester Hub Conditional Output Statement Moving beyond the general 2.13 prescription of Eddington that links between and within city regions are important to economic growth, how the city regions in the North interact and the importance of linkages between them has been explored in some depth first by Sustainable Urban and Regional Futures (SURF) et al (2006) in a study for NWDA that focussed on the North West, and subsequently as part of a North-wide analysis by IPEG et al (2008) for the Northern Way. The study by SURF et al for 2.14 NWDA used five research strands to inform the derivation of their overall findings.

These were surveys of Small and Medium Enterprises (SMEs), which were conducted with the collaboration of key Chambers of Commerce; work with secondary data sources to look at the organisation of larger firms; work looking at the interaction between key higher education institutions and businesses; interviews with key corporations; and, analysis of econometric data. From these five workstreams SURF et al identified four key activity clusters that stood out in terms of their importance in contributing to the North West’s economy and their recent economic dynamism. These are Manchester (particularly south Manchester and north Cheshire), Liverpool, Chester/ North Wales and Preston.

They also identified as important the economic linkages between the North West and West Yorkshire in general, and Manchester and Leeds in particular, both in terms of overlapping journey to work catchments and the potential for greater business to business interaction. Their work highlighted the importance to businesses in these five nodes of access to international air services at Manchester Airport. SURF et al concluded: 2.15 “the economic importance of our five nodes will continue to grow in future years. All the evidence is that ‘path dependency’ is a powerful logic that is likely to see recent trends being maintained and deepened.

As a result, economic and spatial strategies for the

17 Manchester Hub Conditional Output Statement North West that aim to realize economic potential need to: (a) give substantial attention to the four [North West] nodes and the connections between them; and (b) continue to bear in mind the opportunities that might arise from developments across the Pennines” SURF et al (2006: unpaginated) Their work also led them to 2.16 conclude: “The crucial importance, for … ● ● [the North West], of expanding the international linkages provided by Manchester Airport and further improving its accessibility along with that of the quickly-expanding John Lennon airport whose growth has underpinned recent economic improvement in the Liverpool city- region The importance of improvements ● ● in connectivity within city-regions in enabling stronger labour market linkages between areas of need and growth, and The economic value of good quality, ● ● fast and reliable transport links to London.” SURF et al (2006: unpaginated) The work by IPEG et al (2008) 2.17 extends the analysis undertaken by SURF et al to the whole of the North.

Again using a mixture of targeted surveys, analyses of econometric data and analyses of secondary data sources, the work explored three themes: the roles and economic functions of the North’s city regions, connectivity within and between city regions and how the North’s city regions stand within a national hierarchy. IPEG et al concluded: 2.18 “the prosperity of the North as a whole will be increasingly driven by the economic performance of the Manchester and Leeds city regions and the putative growth belt that connects them to the Sheffield and Liverpool city regions, the smaller outlying growth centres around York, Chester and Preston and the Tyne and Wear city region in the North East” IPEG et al (2008:35) and “This invites…a strategic approach to inter-city connectivity focused upon prioritising interaction between relative ‘equals’ (for instance Manchester and Leeds) or between centres which vary in their economic specialisms (for instance Liverpool and Manchester) which would also improve the labour market between them.

There would appear to be particular value in developing this approach to promoting cross-Pennine links – including better access to Manchester Airport from Leeds – given that the Pennines continue to act as a barrier to realising the joint agglomeration potential of the North’s largest and most dynamic city regions” IPEG et al (2008:37) As part of a Research 2.19 Programme, the Northern Way is sponsoring work by the LSE’s Spatial Economics Research Centre (SERC) which will extend further the evidence base on the future development of economic links between Leeds and Manchester. This work is scheduled to conclude in autumn 2009 and will then be published on the Northern Way’s web site.

Enhancing links between the North’s city regions will support and facilitate future economic growth. Enhancing the trans- Pennine corridor will support growth of the North’s two largest city region economies and will also benefit the wider North.

18 Manchester Hub Conditional Output Statement Connectivity within the North’s City Regions As has already been highlighted, 2.20 city regions are seen as the engines of economic growth. The importance of connectivity within city regions to support economic growth has been identified by the Northern Way Growth Strategy (Northern Way, 2004), the Northern Way’s Strategic Direction for Transport (2006) and by Eddington (2006).

Through their City Region Development Programmes and other strategic documents, city regions across the North have each identified the importance of enhancing connectivity within city regions to support future economic growth. What is seen across the North 2.21 is that in peak hours road networks are operating at or close to their operational capacity (Steer Davies Gleave, 2008b). Congestion leads to extended journey times and unreliable journeys. This has an economic cost. Significantly, there is little capacity for peak hour trip growth by road, with growth in trip making accommodated by either peak spreading (which in turn results in congestion being experienced in other time periods) or by increasing public transport use.

This is the experience of 2.22 Leeds and Manchester, the two most significant city economies in the North. In recent years both city centres have experienced employment growth while neither city centre has experienced commensurate growth in peak hour car commuting. However, both city centres have experienced a significant growth in peak hour rail (and in the case of Manchester, Metrolink) demand (see GMTU (2008), Metro (2008)). This has led to the conclusion that it is public transport which has accommodated recent growth in city centre employment in these two key locations in the North. However, this growth has occurred at a time when rail has had a degree of excess capacity and has been able to accommodate growth.

Now on- train crowding is becoming significant (Network Rail, 2007 and 2008) so the absence of capacity to accommodate further growth in peak period rail trip making, as well as the constraints on the rail network’s scope and reach have been identified as a threat to the city’s future economic growth (Association of Greater Manchester Authorities (AGMA), (2007)). Manchester’s rail network has facilitated the city’s sustainable economic growth by supporting the growth in city centre employment. However, on-train crowding and the current scope and reach of the network limits the scope for future growth.

By comparing the economic 2.23 interactions between Reading and London, and Burnley and Manchester, Centre for Cities (2008) focussed on the links between large city region economies and smaller towns and cities that fall within their economic influence. They found that towns such as Burnley are not integrated within the Manchester labour market despite being close in terms of distance. This was in marked contrast to the situation observed between Reading and London where Centre for Cities identified a strong economic interaction. They went on to identify the strong transport links between Reading and London and the poor transport links between Burnley and Manchester as explanatory factors.

They conclude “the issues of connectivity between core cities and their neighbouring areas play a key role in explaining differences in economic performance in regional economic performance between the North and Greater South East” (Centre for Cities (2008:18)).leading to a prescription that

19 Manchester Hub Conditional Output Statement enhanced links between core cities in the North (such as Manchester) and smaller near-by towns would increase the spill-over effects from the larger economy and boost economic growth. As IPEG at al (2008) describe 2.24 the effect of poor connectivity leading to limited economic interaction is not limited to towns close to the larger city economies. It can also occur within city regions. Looking at the Manchester City Region IPEG at al show that while GVA in the Greater Manchester South NUTS3 area has grown more than any other location in the North, growth in Greater Manchester North has been lowest.

In part this is attributed to the relatively poor north-south links within the Manchester City Region resulting in the north of the conurbation not enjoying spillover effects from growth in the south.

Supported by the Northern Way’s 2.25 Research Programme, work is in hand to look further at the spillover effects from stronger to weaker economies identified by Centre for Cities. The findings of this work will be published on the Northern Way’s web site in due course. Linking areas of economic need such as North Manchester or the Pennine Lancashire towns with locations with stronger economic growth like Manchester City Centre, South Manchester and around Manchester Airport supports the stronger areas by extending labour markets, while at the same time facilitating spill over effects into the weaker areas.

International Links Thus far we have summarised the 2.26 evidence on the importance to future economic growth of links within and between city regions and links within city regions. Also of importance is international connectivity. York Aviation (2006) in their study of the economic importance of the Manchester Airport Group companies has identified the following economic impacts of air transport: Direct impacts: employment, income ● ● or outputs that are wholly or largely related to the operation of an airport and are generated either on-site or in the surrounding area Indirect impacts: employment, ● ● income or outputs that are in the chain of suppliers of goods and services to the direct activities Induced impacts: employment, ● ● income or outputs that are due to household spending resulting from direct and indirect employment Catalytic impacts: employment, ● ● income or outputs that are generated by new businesses locating to the region, inward investments and inbound tourism; and Productivity/competitive advantage ● ● impacts: employment, income or outputs gains amongst existing businesses in the economy due to increased export volumes and productivity improvements.