Boost to Sheffield's HS2 campaign as Osborne pledges £300m for road and rail in North

The money will help develop plans for high speed trans-Pennine rail services - dubbed ‘HS3’ - and a road tunnel connecting Manchester and South Yorkshire.

The Chancellor asked the National Infrastructure Commission, led by former Labour Transport Secretary Andrew Adonis, to look at transport projects to transform its economic fortunes.

In its report, the commission says fast trains between city centres are key to a ‘high speed north’ - and HS2 should be used to create the network.

It states the design of the northern phase of HS2 should ‘facilitate the development of the HS3 network, enhancing connectivity between Leeds and Sheffield’.

It adds: ‘Route decisions on the northern sections of HS2 to be announced later this year should support enhanced high-speed connections.’

The report recommends a full plan for the HS3 network covering cities including Sheffield and Hull should be in place by the end of next year.

Lord Adonis said: “A better connected north will be better for jobs, better for families and better for Britain.

“The work should begin as quickly as possible.”

The news is a boost to campaigners - including The Star - calling for an HS2 station in Sheffield city centre, a switch from the government’s choice of Meadowhall, to maximise the economic impact of the high spped line. Figures from HS2 Ltd show it would create 6,500 more jobs.

Sheffield city council leader Coun Julie Dore welcomed the NIC report saying it threw further weight behind the campaign.

She said: “This report puts forward a lot of the points we have been arguing for a long time. The 30-minute city-centre-to-city-centre connectivity for Sheffield, Leeds and Manchester, will be transformational to our economy, delivering the crucial links we need between our major cities.

“This report sets out how we can make this a reality but a Sheffield city centre HS2 station is essential to deliver it.

“The Leeds HS2 station location has been reviewed to take account of HS3 and connecting our city centres, that’s exactly what we need for Sheffield as well.

“Not only is there an overwhelming economic case for a HS2 city centre station in its own right, but it is becoming increasingly obvious that it is also essential for delivering HS3 to link Sheffield city centre with cities across the north of England.”

The NIC report builds on a Transport for the North report published last week which also called for 30-minute city-centre-to-city-centre connectivity between Sheffield, Leeds and Manchester.

The National Infrastructure Commission was created to make strategic decisions on infrastructure and is set to be established as an independent body in law.