The regions need sights to be raised beyond London

Amid all the hype and hysteria surrounding the cost and benefits of the 2012 Olympics – regeneration “legacy”, big lift for Thames Gateway and, more spuriously, a boost for Britain – you can be forgiven for missing a plea last week from the second city.

Birmingham wants the government to approve a mere £388m to upgrade the bottleneck of New Street station, where passenger numbers have increased by 50 per cent in five years. This is small change when set against the cost of the Channel Tunnel Rail Link, which, inexplicably, hits the buffers at St Pancras (£5.5bn), Crossrail (£10-£16bn), an upgrade of Thameslink (£3.5bn) and the Olympics themselves (edging towards £8bn).

Citing “colossal capacity pressures” at New Street as Birmingham awaits a government decision, Nick Paul, chairman of the West Midlands regional development agency, pleads: “An upgraded New Street would benefit commuters from Scotland to the south-east and from the north-east to the south-west.”

But not, some fear, from London. There’s the rub. From a relatively booming Manchester and Leeds, to an under-performing Tyneside, it is a similar story: plans to upgrade, expand or (in the case of Leeds) build new light rail tram schemes are either delayed or shelved. Today, any modest infrastructure project outside the capital is deemed incidental to the national interest. With Olympic costs soaring and a tighter spending round looming next year, we can be sure of only one thing: London/south-east centricity will gain an even firmer foothold in the Whitehall mind-set. It need not be this way.

The problem with raising questions about national spending priorities is that any criticism of the capital is seen as a northern whinge; that people in outlying regions, like myself (much closer to the wealth generated from Scottish oil) do not understand the importance of the capital to the national economy and the need to keep the City at the top of the financial centre premier league. Well, I do. I recognise that London and the greater south-east need more affordable housing for the people that service its ever-expanding economy. I salute mayor Ken Livingstone’s advocacy of London, his ground-breaking congestion charge and much else besides, as an example for other conurbations to follow.

But I do find the latest campaign from the lobbying group London First a tad chauvinistic, with some of its claims disingenuous. At its worst, the campaign is a mirror image of the Scottish National party’s “It’s Scotland’s Oil” onslaught in the 1970s. For Scotland propping up the British economy read: “London’s £80bn in taxes supports the whole of the UK.” An extension of this puerile argument a few years’ ago, could have been: “the north-east propped up the London economy with coal to fuel southern power plants” – not to mention the obvious rejoinder from Scottish nationalists.

The more questionable claim is that London has the country’s “highest jobless rate”. While that might be correct on the narrow definition of unemployment, when the high level of “worklessness” is factored into the equation – people on sickness benefit – the north-east, Wales and Scotland far outstrip London. Figures produced by Professor Steve Fothergill at Sheffield Hallam University show that, at 2003 levels, the north-east has over 6 per cent of its working population on such benefit, compared with 2 per cent in London.

So what to do? A twin-track approach would be helpful. That means, while recognising the importance of London to the UK economy, raising the limited sights of policymakers beyond the capital and the wider south-east when big infrastructure decisions are made. Shortly, for instance, the government is likely to approve plans for a new container port on the Thames at Shellhaven. But did it consider the wider implications for the national economy with underused capacity at Tees-port, which is desperate to expand?

Recently, I heard a senior official at the Department for Transport put the case for two new runways at Heathrow to meet future demand. Can the south-east cope with much more? Big regional airports, such as Manchester, can take extra traffic, with improved rail links. But are they part of the bigger DfT picture?

Finally, does the government have a framework to connect England – embracing improved rail links, a rational airport and port strategy, for starters – outside the narrow confines of the greater south-east?

The writer, former regional affairs editor of The Guardian, chairs a Town and Country Planning Association commission, A Vision for England’s Future