﻿Five years after the government launched its northern powerhouse concept, 200,000 more children in the north of England are in poverty, foreign investment has plummeted and the number of late or cancelled trains in the region has more than doubled, new analysis shows.

Research by the thinktank IPPR North also found there had been a £3.6bn cut in public spending in the north since 2010, compared to a £4bn rise in the south.

In interviews to mark five years since George Osborne, then chancellor, unveiled his plan to rebalance the UK’s economy, the north’s political leaders said the project had “halted” with little sign of it being revived.

Ben Houchen, the Conservative mayor for the Tees Valley, said his region had benefited massively from devolution but the northern powerhouse agenda had “demonstrably dropped down the list of priorities” under Theresa May’s premiership.

“The only reason the northern powerhouse worked is that you had George Osborne at Treasury driving it,” he said. “To deliver the northern powerhouse you’ve got to have those levers at Treasury that you can pull to make it work … The new leader of the Conservative party is going to have to address that issue and make sure that it’s put back on the map.”

The northern powerhouse agenda has delivered some important successes, notably the introduction of metro mayors covering half of the north of England, and the creation of Transport for the North, which has a £70bn investment plan for the region’s beleaguered railways.

IPPR North said economic growth was marginally higher in the north compared to the national average, and the productivity gap between north and south had narrowed slightly. However, the thinktank’s research suggests that life for many people in the north has not improved since 2014.

In the past five years weekly pay has increased by only £12 in the north, compared with £19 nationally in real terms, and the number of jobs that pay less than the living wage of £9 an hour has risen by 150,000 or 10.9%. The research found there were 37,000 fewer public sector jobs in the north than there were 10 years ago.

Sarah Longlands, the director of IPPR North, said the northern powerhouse agenda had helped build momentum around the need to address the UK’s inequalities, but “it has failed to tackle fundamental challenges like child poverty, insecure work and poor health.”

Judith Blake, the leader of Leeds city council, said it was “really scandalous” that so many more northern children were now living in poverty – many of whom had at least one parent in work. “They have been hit by a double whammy. Yes there is more employment, but the work is insecure and working people are often still relying on benefits, which have been cut,” she said.

Council leaders said the extra investment brought by devolution could not plug the gap from the swingeing cuts to local authority funding started by Osborne’s austerity programme in 2010.

Joe Anderson, the mayor of Liverpool, said his local authority had lost £440m a year in funding from central government. “Devolution has halted and it’s not delivering because the money we’re getting is not making up for what’s been taken away from us through austerity,” he said.

Sir Richard Leese, the leader of Manchester city council for 23 years, said any money Greater Manchester had received as a result of devolution – such as £243m from the “transforming cities fund”, which the mayor, Andy Burnham, has spent on trams and walking and cycling – could not make up for the £372m of cuts he had had to make since 2010. “But some money is better than no money,” he shrugged.

In the Tees Valley, Houchen highlighted the return of the local airport to public ownership and his new £600m investment plan for the region as some of the successes of the northern powerhouse. However, he said that with the government distracted by Brexit, the project had drifted despite the efforts of the northern powerhouse minister, Jake Berry.

“It doesn’t matter how senior a minister is, you have No 10 and No 11 [Downing Street] and if those two offices don’t believe in the northern powerhouse, it’s very difficult to make real progress,” he said.

In Leeds, Blake has been trying and failing for the past two years to persuade the government to back a One Yorkshire devolution deal that would bring together the county. “What we haven’t got is a champion in government to lay out our vision,” she complained.

She said the government had given northern leaders a say in certain things – such as the conditions of the current rail franchises for Northern and Transpennine – but had failed to sign off crucial accompanying infrastructure investments that would make the franchises work. Some platforms at Leeds station have still not been extended to accept longer trains, and modernisation plans for Manchester Piccadilly and Oxford Road stations are still sitting on the desk of the transport secretary, Chris Grayling.

In addition, Blake said there was a serious question mark over whether Northern Rail would fulfil its franchise commitment to phase out the much-derided Pacer trains by the end of the year.

Jim O’Neill, a former Goldman Sachs economist who was a key architect of the northern powerhouse, said the initiative had suffered from the “Whitehall policy vacuum of the last three years”.

Lord O’Neill and Osborne went on numerous trade delegations overseas to promote the northern cities. “Now when I travel to China or wherever, people say: whatever happened to the northern powerhouse?” he said.

He criticised Burnham and other mayors for spending too much time moaning and not enough time presenting government with positive ideas. “In government these guys are viewed as emotional crackpots who are always going on about being the ‘poor, starving north – come and help us’,” O’Neill said.

There is still a question mark over whether Northern Rail will fulfil its franchise commitment to phase out the Pacer train. Photograph: Christopher Thomond/The Guardian

Houchen, who is backing Boris Johnson in the Conservative leadership contest, said he believed the former foreign secretary was fully behind the northern powerhouse project. He said the next big test for government was whether it pledged support for Northern Powerhouse Rail, a new £39bn east-west railway line, in the autumn spending review.

O’Neill agreed. “It is way more vital than HS2. Without it, government can never show it is taking the north seriously,” he said.

Jamie Driscoll, the new Labour mayor of the North of Tyne region, said the government must agree to devolve the shared prosperity fund that will replace European grants. “We can provide a joined-up strategy – looking at business, environment, transport and education – in a way that people in Whitehall can’t.” Currently he has just £20m a year extra to spend as he sees fit.

He said the government should devolve the budgets “to the people on the ground who actually know what is going on … Longer-term, we need independent revenue streams and not be bidding for things but have money directly allocated. In my region, you can’t get here on a motorway. If you want to drive from one side of it to another you have to drive on single-lane roads. If the Department for Transport was based in Newcastle no one would have had to make a proposal, written a paper, lobbied, it would just have happened: we would have a good road network.”

A government spokeswoman said: “Five years on, the northern powerhouse remains a priority for the government and is delivering results for people across the north with a record number of people in work and nearly 200,000 more businesses today than in 2010.

“We’re investing over £13bn in improving transport – more than any government in history – and, with almost half the region represented by five strong metro mayors, we’re keeping our promise for more decisions in the north to be made by the north.”