There is growing concern about the future of a major link for Northern Powerhouse Rail, after transport secretary Louise Haigh said funding for the £12 billion line between Manchester and Liverpool is in doubt, as the government continues its efforts to balance the books.

Conservative transport secretary Mark Harper had said earlier this year that the new line would be funded by money released from the cancellation of HS2 to Crewe and Manchester.

But yesterday Ms Haigh sounded a note of caution during the Labour Party conference.

She told reporters: ‘The previous government went round promising money like there was no tomorrow, including all their commitments on Network North. They hadn’t made an agreement with the Treasury so that funding is not practically available at the moment.

‘However, we are really conscious of how important that line between Liverpool and Manchester is and the investment in Manchester Piccadilly. So what I am doing at the moment is taking a step back, looking at everything in the round, and then we will come forward with a proper long-term infrastructure strategy that serves the country as a whole and makes sure we deliver growth in the areas of the country that need it most, rather than just walking around pointing at marginal constituencies and announcing stations and lines.

‘There is not the money that was allocated to HS2 sitting in a pot somewhere. Any transport project that is put forward has to go through the stages of business cases and development and then through the negotiations with the Treasury. I am not making commitments on any individual projects at the moment, we are only nine weeks into government. We will make sure that when we develop the strategy, that is the strategy we deliver, rather than these constant u-turns and promises that just really undermine confidence, particularly in the north.’

Manchester Mayor Andy Burnham responded: ‘We will not accept the cutting of that. You can’t cut HS2 then cut this, just paring back everything. We won’t accept that. We believe the government of any colour needs to honour promises to the North of England and that’s what we will fight for.’