Osborne Appeals to Labour's Heartland By Eyeing 'Northern Powerhouse' Build
Osborne Appeals to Labour's Heartland By Eyeing 'Northern Powerhouse' BuildReuters

UK Chancellor George Osborne believes building an east- west, high speed railway between Manchester and Leeds will forge a "Northern powerhouse" of business growth and activity outside London.

Osborn is to unveil plans for new infrastructure and tunnels which will enable existing trains between the two cities to run faster, with the creation of jobs and better opportunities in the region, according to extracts from a speech he will deliver in Manchester today.

"The cities of the north are individually strong, but collectively not strong enough," Osborne will say.

"So the powerhouse of London dominates more and more. And that's not healthy for our economy. It's not good for our country."

"In the modern knowledge economy, businesses and entrepreneurial types want to flock together more than ever. To form clusters where they can learn from and spark off each other."

Labour's Heartland

The Conservative-led coalition government has focused on northern England region over the last few months in a bid to win voters from Labour's heartland.

While the UK economy is set to grow by 3% in 2014, according to Bank of England forecasts, many have criticised the focus on the country's capital for creating jobs, opportunities and being the linchpin for an overall financial recovery.

For example, earlier this year, the Trade Union Congress revealed that the North and the West Midlands are missing out on the UK's economic recovery as the likelihood of being employed in those regions has fallen since mid-2010.

The TUC, which analysed regional labour markets over the last 20 years, said that since the 2010 General Election there are now 780,000 more people in work across the country and the likelihood of having a job has also increased – up 1% since 2010.

In June, Whitehall's Department of Business Innovation and Skills (Bis) led a Building Britain summit, which included the unveiling of hundreds of new jobs in the region.

This includes manufacturing giant Jaguar Land Rover's plans to create 250 jobs in the North West of England as part of a £200m (€250m, $341m) investment plan.

Meanwhile, another high-speed rail connection between London and Birmingham is already planned, and is due to be completed in 2026.

In addition, an extension to Leeds and Manchester is to be finished by 2033.

However, the Labour Party's shadow chancellor hit back at the coalition governments plans and pledges.

"Nobody will believe the Tories (Conservatives) can deliver the jobs, growth and investment we need for the north of England," said Ed Balls.

"Regional growth divides have widened markedly since 2010."