Network Rail aims to transform rail travel in the north of England through better stations and quicker, more frequent services under a £560m programme of investment between 2014 and 2019.

Osborne said: “I confirm today that Network Rail will extend the Northern Hub, adding to the electrification of the Transpennine rail route, by upgrading the Hope Valley line between Manchester and Sheffield – and improving the Manchester to Preston and Blackpool, and Manchester to Bradford lines.

“For years, transport investment in the north of England was neglected. Not under this Coalition Government.

“We are working with our great cities to devolve decision-making powers – and we are striking a ground-breaking deal with Manchester to support £1.2 billion in growth-enhancing infrastructure.”

The new plans will plans to upgrade railway lines from Manchester to Preston and Bradford brought forward.

Network Rail chief executive David Higgins said: “Today’s announcement of further funding for the initial stages of the Northern Hub is a welcome show of confidence in rail bringing benefits to passengers as well as driving economic growth.

To realise the project’s total value of £4bn to the Northern economy and create between 20,000 and 30,000 new jobs, the final stages of funding will need to be supported in the rail budgets to be announced later this year.

“When completed, this project will be a clear demonstration of how investment in smart infrastructure can unlock economic potential by connecting commerce and communities across cities such as Manchester, Liverpool, Sheffield, Leeds and Newcastle with 700 new train services each day.”