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Government set to allocate over £500m to Northern Powerhouse 25 January 2017

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In her first regional cabinet announcement, Theresa May unveils an ambitious northern strategy designed to create jobs and encourage growth.

Prime minister Theresa May has unveiled her support for the Northern Powerhouse, using her first regional cabinet announcement to lift the lid on a number of new plans designed to promote growth, improve job numbers and provide a better level of education in technical subjects.

In what was the prime minister's first meeting outside of London since she came to power last July, she said that plans to provide more than £500 million in funding to the north of England will help the UK to forge a "stronger future".

The £556 million Northern Powerhouse investment will see boosts given to industry and jobs from east to west across the north, with everywhere from Blackpool to Hull and its near neighbours seeing positive impacts as a result.

Speaking at the announcement, May said that continuation of the work previous chancellor George Osborne had done when he put together the Northern Powerhouse was important in creating a fair Britain that works regardless of geographic barriers.

"When George started the Northern Powerhouse, part of that was about investing in infrastructure which can boost business growth, boost economy and boost investment in the area from the private sector," she told the Manchester Evening News.

Northern Powerhouse fund

The main focus of the announced funding for the Northern Powerhouse is to improve transport and innovation across the key areas in the region, both of which are vital to making sure the north of England has the ability to perform well.

Modern businesses with a forward-thinking strategy will be able to benefit from the new innovation fund for businesses in Manchester and Cheshire, which encourages companies to look at new ways of working and new strategies to help the Northern Powerhouse become a world business leader.

Transport will also be at the centre of plans to boost infrastructure throughout the north. Goole will see its Intermodal Terminal, linking rail, sea and road built, while the government also announced as part of its ten-point plan that issues such as broadband upgrades and a focus on green energy will be used to strengthen the Northern Powerhouse's credentials. This will allow the region to try to attract more businesses to invest in cities such as Manchester and Leeds.


One of the other main points of focus for the announcement came in the form of new funding for the education sector in the north of England. Given the prominence of digital, tech and marketing companies in Manchester and Leeds, this was an important addition to the budget, and one that will be welcomed by city leaders and businesses alike.

The prime minister announced that £170 million will be spent on creating new institutes of technology, while also investing in STEM (science, technology, engineering and maths) skills, digital skills and numeracy.

All of these investments help to build a skills pool that will not only help to fill jobs, but also create them, with more businesses likely to move to areas in the north that have a strong pool of knowledge.

Industrial Strategy Challenge Fund

As part of a larger £4.7 billion fund, the government will also be looking to promote innovation in the north, and to break into new industries and further existing ones, with plans to encourage and support research in a number of areas identified as being important for expansion and future growth of the region.

Robotics, the development of 5G connections, artificial intelligence and smart energy are just a number of key drivers of growth that the government wants to see expanded in the next few years using this fund.

The director-general of the CBI, Carolyn Fairbairn, welcomed the move, saying the government "must help fix the country's productivity problems and remove the regional inequalities that have dogged our country for generations, having a positive impact on living standards, wages and the future opportunities of many people".

While it remains to be seen how beneficial the new funding will be to the Northern Powerhouse, the fact that a new government is willing to commit to growth and development on a number of levels can only be good news for the expansion of the region and its continued impact on the UK's economy.

And while the fund has been largely welcomed with open arms, critics have said that there's still a way to go for the government to build on this announcement, with the Northern Powerhouse fund commitment still far lower than the money promised for projects based in London, such as Crossrail and the Thameslink Programme.