The National Infrastructure Commission has recommended that investment should be focused on boosting mainline services across the North and the Midlands rather than the full eastern leg of HS2.
The independent advisory body said that government should progress the western route into Manchester, but delay starting the eastern side to Leeds in favour of investment in upgrading existing city rail links.
Its controversial report now has been sent to Government to help inform investment priorities.
The Commission has outlined how different mixes of schemes could fit together, developed as five packages of rail investments within three different budgets – £86bn, £108bn and £129bn.
Barry White, chief executive at Transport for the North, said: “The National Infrastructure Commission’s report validates the vision of Northern leaders – recognising the desperate need to better connect the North’s towns and cities through new lines and significant upgrades as part of Northern Powerhouse Rail.
“But in all the NIC scenarios this would fall short of the full stated ambition of Northern leaders.
“That such investment in our rail network would also come at the expense of HS2’s long-awaited arrival to Yorkshire is a bitter blow and one we oppose. The NIC was tasked with integrating these projects – not pitching them against each other.
Sir John Armitt, Chair of the National Infrastructure Commission, said: “Major rail schemes will be an important component in levelling up the country’s economic geography, but we should ensure public money is carefully spent where it can make the most difference.
“The number and scale of rail schemes currently being proposed for the North and Midlands mean that some form of prioritisation will be necessary, and we think there are ways of bringing forward benefits for communities and businesses while keeping options open for additional investments if the circumstances are right.
“Our independent analysis offers government various ways of targeting spending depending on the precise economic and social outcomes it wants to achieve.”
White added: “The Government now has a bold choice to make on how much it truly wants to level-up through transport investment.
“As the report shows, increasing rail spend could transform the North’s fortunes.
“But constraining spending and ambition will lead to cut-price versions of the current plans and promised projects simply not being delivered – that will curtail investment in the North and cost many jobs.
He said: “We now strongly urge the Government to be ambitious in its decision-making. If the mission is to ‘build back better’, then the message is simple: commit to the options that deliver true transformation for the North.
“That includes better connections for communities such as those in Liverpool, Bradford, Sheffield, Hull and the North East; proper and reliable east and west links; and exploring ways to accelerate construction of projects including the full HS2 network.”