Ed Cox is the Director of IPPR North.

Legislation was passed yesterday to establish Transport for the North as a statutory transport body. While this is unlikely to hit the headlines, it represents a significant step forward for all those who aspire for a rebalancing of the national economy.

Transport is by no means the only driver of economic productivity, but good connectivity is a necessary if not sufficient condition for competitiveness in the global economy. Transport has also become emblematic of the so-called Northern Powerhouse project. The idea that a thriving Northern economy depends upon better connections between the great cities of the North was central to the Osborne-O’Neill narrative and continues to drive the ambition of Northern political and business leaders alike. And so it should.

The fact that it takes longer to get from Liverpool to Hull than it does to travel from London to Paris tells us a lot about the state of inter-city connections in the North, but intra-regional connections are also abysmal and are a key reason why many Northern towns struggle to transition from their proud industrial pasts. It beggars belief that it can take over an hour to get from Middlesbrough to Newcastle or Burnley to Manchester by car or train over distances no longer than 30 and 40 miles respectively and that there are barely two trains per hour. Poor connectivity diminishes access to markets and skilled labour and drags down Northern productivity.

At a simple level, it is easy to point to under-investment as the main reason for such poor transport links. Few can dispute the fact that, in recent decades, public and private investment in transport infrastructure in London and the South East has dwarfed that spent in the North. Using official ONS Country and regional public sector finances expenditure tables, which present historic transport spending by region, public spending alone was on average £282 per head in the North compared to an average of £680 per head in London over the last ten years. This equates to a £59 billion historical spending gap.

Future spending is more contentious, with Chris Grayling insisting that the current Government has reversed this trend. We will soon publish a new, independent analysis of the latest National Infrastructure Pipeline, clearly explaining the methodology used by government and ourselves at IPPR North and allow the public to decide for themselves.

But there is a risk that this preoccupation with spending might miss a more fundamental point. One of the primary reasons given for historical spending disparities has been that London has had more ‘shovel-ready’ projects primed for investment. Little wonder. Thanks to the office of the Mayor of London and Transport for London, the capital city has had the independent capacity to develop ideas for major investment – something that has only been possible in the North since Transport for the North came into being back in 2015.

In the three short years since it was established, Transport for the North has made significant progress. Many thought that it would be impossible to bring together its 19 constituent authorities, comprising 56 different local councils across the North, but late last year they signed off a draft Strategic Transport Plan which, later this month, will go out for wider consultation and the public will be able to scrutinise those projects deemed regional priorities.

This is where the rubber will almost literally hit the road. Not only will the travelling public begin to envisage the kind of transport improvements they have long yearned for, but equally pressure will grow on government to put more money where its mouth is. The oft-cited £13 billion – some of which was committed even before 2010 – is but a tiny part of what will be needed into the future. In fact the £59 billion London has received over the past decade would not be an unreasonable claim as ‘catch-up cash’ for the North.

In a recent blog, John Cridland, Transport for the North’s independent chairman and the former CBI boss, summarised the current situation very neatly:

‘Becoming a Sub-national Transport Body will make Transport for the North a legal entity and a formal partner with Government. Through Transport for the North, the leaders of the North of England (which if it was a country in its own right would be one of the ten biggest economies in Europe) will be able to identify the infrastructure priorities that the region wants and needs, not those that Whitehall thinks it needs. It will ensure plans we are developing in the Strategic Transport Plan can form the priorities for both Highways England’s and Network Rail’s future investment programmes.’

But unfortunately, for now, this will be the limit of Transport for the North’s powers. Unlike Transport for London, it will not have the fiscal powers it needs to match public and private investment as London has done so successfully with Crossrail nor the revenues it generates through service provision. Transport for the North is not the same as TfL and must find its own development path, but without its own fiscal powers it will forever be in hoc to the Department for Transport and its national agencies.

In a speech to Northern leaders in August 2017, Grayling stated: “I want the North to take control”. Yesterday in Parliament, we passed a significant milestone in that quest, but the truth is that there remains a long journey ahead and government must get better used to letting go. If it’s good enough for London, it’s good enough for Northern leaders, too.