8th Report - Northern Powerhouse Rail
Select Committee
Public Accounts Committee
HC 97
1 July 2026
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Recommendations & Conclusions
30 results
2
Recommendation
There is a clear risk that the Department will not be able to manage the...
Recommendation
There is a clear risk that the Department will not be able to manage the programme within its £45 billion funding cap. HM Treasury has set a £45 billion funding cap for the programme. This may help affordability, but we …
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HM Treasury
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3
Conclusion
The Department has not yet put in place appropriate governance arrangements with other central government...
Conclusion
The Department has not yet put in place appropriate governance arrangements with other central government departments. Northern Powerhouse Rail requires input from and coordination with other central government departments like HM Treasury and the Ministry of Housing, Communities and Local …
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HM Treasury
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4
Recommendation
The Department’s arrangements for working with local government do not appear sufficient to manage the...
Recommendation
The Department’s arrangements for working with local government do not appear sufficient to manage the trade-offs it will need to make on funding and scope. The Department has agreements in place with individual local areas and is working with local …
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HM Treasury
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5
Conclusion
The Department has not yet set out how Northern Powerhouse Rail will work alongside national...
Conclusion
The Department has not yet set out how Northern Powerhouse Rail will work alongside national and local transport plans and priorities. The government intends for Northern Powerhouse Rail to support future work to improve north-south connections on the West Coast …
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HM Treasury
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6
Recommendation
We are not convinced that the Department has embedded all lessons from past failures into...
Recommendation
We are not convinced that the Department has embedded all lessons from past failures into its management of the programme. We recognise that the Department has adapted its approach to Northern Powerhouse Rail in response to lessons from High Speed …
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HM Treasury
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1
Conclusion
On the basis of a report by the Comptroller and Auditor General, we took evidence...
Conclusion
On the basis of a report by the Comptroller and Auditor General, we took evidence from the Department for Transport (the Department), the Ministry of Housing, Communities and Local Government (MHCLG), and HM Treasury’s Northern Growth Envoy.1
HM Treasury
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7
Conclusion
The Northern Growth Strategy sets out how the government expects providing better connections between northern...
Conclusion
The Northern Growth Strategy sets out how the government expects providing better connections between northern city regions and towns through Northern Powerhouse Rail to support economic growth, for example by widening the pool of workers available to firms and the …
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HM Treasury
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8
Conclusion
HM Treasury has set a funding cap of £45 billion (2025 prices) on programme spend...
Conclusion
HM Treasury has set a funding cap of £45 billion (2025 prices) on programme spend from 2026–27.12 The funding cap amount was based on factors including early estimated cost ranges based on potential scope options and assessment of long-term affordability, …
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HM Treasury
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9
Conclusion
However, the Department has a track record of high infrastructure costs and poor cost estimation...
Conclusion
However, the Department has a track record of high infrastructure costs and poor cost estimation on its major rail projects. For example, in February 2025 we reported that the £45 billion budget for High Speed Two (HS2) Phase 1 was …
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HM Treasury
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10
Conclusion
We asked the Department how it would ensure within-budget delivery for Northern Powerhouse Rail phases...
Conclusion
We asked the Department how it would ensure within-budget delivery for Northern Powerhouse Rail phases 1 and 2 so that there is funding left for the cross-Pennine improvements in phase 3. The Department replied that its approach was to not …
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HM Treasury
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11
Conclusion
The Department told us that local places could also top up the funding from central...
Conclusion
The Department told us that local places could also top up the funding from central government.19 We asked how the Department was supporting local funding contributions and ensuring areas less able to mobilise funds are not left behind. The Department …
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HM Treasury
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12
Conclusion
The NAO found the Department had established appropriate steps to identify lessons from other major...
Conclusion
The NAO found the Department had established appropriate steps to identify lessons from other major programmes, but that it needed to go further to embed these in Northern Powerhouse Rail.23 In oral evidence, the Department was clear on the importance …
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HM Treasury
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13
Conclusion
However, a Department-wide review by the Government Internal Audit Agency (GIAA) in January 2026 found...
Conclusion
However, a Department-wide review by the Government Internal Audit Agency (GIAA) in January 2026 found that programme and project teams across the Department were not consistently applying lessons they had identified.25 We asked the Department how it was responding to …
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HM Treasury
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14
Conclusion
In February 2025, we reported that HS2 Ltd’s efforts to reduce the environmental impact of...
Conclusion
In February 2025, we reported that HS2 Ltd’s efforts to reduce the environmental impact of HS2 were not delivering value for money. For example, it was building a 1km ‘bat tunnel’ at a cost of around £100 million to reduce …
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HM Treasury
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15
Conclusion
While the Department for Transport is responsible for delivering the railway, it will need others...
Conclusion
While the Department for Transport is responsible for delivering the railway, it will need others in central government to conduct supporting activities to deliver the intended wider economic benefits.30 The Department told us that “it absolutely relies on the partnership …
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HM Treasury
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16
Conclusion
In 2025, the Office of Value for Money set out its definition for mega- projects—the...
Conclusion
In 2025, the Office of Value for Money set out its definition for mega- projects—the government’s largest and most complex projects—and the government announced changes to how it manages mega-projects to help remove obstacles to delivery.34 The NAO found that …
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HM Treasury
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17
Conclusion
However, the NAO also set out that the government views Northern Powerhouse Rail as a...
Conclusion
However, the NAO also set out that the government views Northern Powerhouse Rail as a programme of different projects rather than one single mega-project.36 In oral evidence, the Department told us Northern Powerhouse Rail was “in effect [ … ] …
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HM Treasury
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18
Conclusion
The Department told us it was discussing with HM Treasury whether Northern Powerhouse Rail would...
Conclusion
The Department told us it was discussing with HM Treasury whether Northern Powerhouse Rail would be designated a mega-project. It said its key concern was how to get the benefits of the mega-project governance reforms as well as the benefits …
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HM Treasury
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19
Conclusion
The Department told us that the government would ultimately take final decisions on the programme,...
Conclusion
The Department told us that the government would ultimately take final decisions on the programme, but that it was seeking to design a governance system and partnership with local leaders “such that—to every extent possible—we get to a consensus on …
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HM Treasury
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20
Conclusion
At the local level, it has discussions with mayors and local councils about specific stations...
Conclusion
At the local level, it has discussions with mayors and local councils about specific stations or corridors, integration with local transport and development plans, and local funding contributions.41 The NAO reported the Department has signed agreements with individual combined authorities …
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HM Treasury
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21
Conclusion
The Department explained it was working with sub-regional groups to develop the railway plans for...
Conclusion
The Department explained it was working with sub-regional groups to develop the railway plans for phases 1 and 2.43 The NAO reported these delivery boards—including the Liverpool–Manchester Railway Board and the White Rose Partnership—are attended by combined authority mayors and …
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HM Treasury
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22
Conclusion
At the programme-wide level, the Department described “unified discussions” with mayors and ministers, where the...
Conclusion
At the programme-wide level, the Department described “unified discussions” with mayors and ministers, where the indicative allocations for each phase of the programme will be set.45 The Treasury’s Northern Growth Envoy, who had been in post since this new role …
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HM Treasury
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23
Conclusion
We are concerned that this partnership-based system is not clear on responsibilities and may not...
Conclusion
We are concerned that this partnership-based system is not clear on responsibilities and may not be robust enough for difficult trade-off decisions between local areas.48 For example, an underground station at Manchester Piccadilly would enable more development opportunities above the …
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HM Treasury
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24
Conclusion
The Treasury’s Northern Growth Envoy acknowledged that “it is really hard to agree stuff across...
Conclusion
The Treasury’s Northern Growth Envoy acknowledged that “it is really hard to agree stuff across the north of England” and that “there are really difficult decisions still to come”.50 However, he said he was confident in the approach they were …
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HM Treasury
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25
Conclusion
As part of its January 2026 announcements, the government committed to building a new line...
Conclusion
As part of its January 2026 announcements, the government committed to building a new line between Birmingham and Manchester to improve north-south connections and meet expected capacity requirements. To enable these improvements, the government confirmed Northern 45 Q 18 46 …
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HM Treasury
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26
Conclusion
We highlighted this gap to the Department.
Conclusion
We highlighted this gap to the Department. It told us it was looking at a range of measures to boost capacity without new infrastructure, but did not provide further detail on the measures. It also explained there was significant uncertainty …
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HM Treasury
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27
Conclusion
The Department was clear on the need for Northern Powerhouse Rail to integrate with local...
Conclusion
The Department was clear on the need for Northern Powerhouse Rail to integrate with local transport, stating that “maximising the benefits of major rail investment requires coherent local planning that joins up rail, regeneration and local transport [and] that is …
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HM Treasury
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28
Conclusion
We asked the Department how it was managing interdependencies with other transport plans and how...
Conclusion
We asked the Department how it was managing interdependencies with other transport plans and how it could ensure Northern Powerhouse Rail was integrated with local transport networks, if local transport decisions were left up to mayors. The Department told us …
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HM Treasury
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29
Conclusion
The Treasury’s Northern Growth Envoy emphasised that their approach with local areas was about more...
Conclusion
The Treasury’s Northern Growth Envoy emphasised that their approach with local areas was about more than just transport and stations, but “placemaking”.63 MHCLG also set out that it was trialling ‘place-based business cases’, which consider how a set of interventions …
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HM Treasury
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30
Conclusion
We asked how the programme’s strategic case would recognise the wider social benefits of investments,...
Conclusion
We asked how the programme’s strategic case would recognise the wider social benefits of investments, and how decisions would prioritise catalysing growth (such as in Bradford) rather than generating marginal gains in already strong economies (such as in Leeds and …
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HM Treasury
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