Ministers have been accused of a “massive power grab” and silencing leaders in the north of England by stripping powers from Transport for the North (TfN), the statutory body set up to advise the government on the region’s transport needs. A senior official from the Department for Transport wrote to TfN’s chief executive, Martin Tugwell, on Thursday saying that it would stop paying the body to develop Northern Powerhouse Rail (NPR), a hotly contested train line across the Pennines. TfN, which is overseen by a board of all the northern mayors and council leaders, had proposed a £36bn scheme to build a new line between Manchester and Leeds with a stop in Bradford. But on Thursday the government said it would only build a bit of new track, with most of the route running on the existing transpennine line via Huddersfield rather than Bradford, which has no through station. The government’s approach cut costs in half but disappointed its own MPs, particularly those in Bradford, which – despite being home to more than half a million people – was recently found to have the worst rail connections of any British city. Robbie Moore, who became the MP for Keighley in 2019, told parliament: “In my view the Bradford district has been completely shortchanged. We are one of the most socially deprived parts of the UK and we must get better transport connectivity.” In a letter sent the day after the government’s rail review was published, David Hughes, the director general of the rail infrastructure group that is overseen by the Department for Transport, told Tugwell it would stop paying TfN to develop NPR. “This work will instead be funded within the normal arrangements for the rail network enhancement portfolio, directly by the department,” he wrote. The shadow transport secretary, Jim McMahon, said: “It’s a massive Whitehall power grab. When George Osborne set out plans for Northern Powerhouse Rail and signed the first devolution agreement with Greater Manchester in 2014, I was the leader of Oldham council and I believed in it, even if it was a Tory government, because it was far better that we control our own destiny rather than be beholden to Whitehall, which would always put us second best. “I just feel like we’ve gone backwards. The complete architecture that’s meant to support devolution has been dismantled.” Andy Burnham, the metro mayor of Greater Manchester, said: “It’s worrying. There’s clearly a number of people in Whitehall who don’t like the idea of the north having a stronger voice. They want to dictate rather than work in partnership. The minute the north starts to come up with solutions and positive interventions, it tries to rein us in. Not only did we lose out on infrastructure, we got silenced as well.” He insisted TfN must not fold. “I will fight for it. This is the one formal structure in the British machinery of government that allows the north to come together with one voice.” The economist Jim O’Neill, who was a northern powerhouse minister under Osborne, criticised TfN’s board for not developing clear priorities. “One of the challenges of TfN was they appear to find it difficult to prioritise and there’s generally too much compromise and not enough conciliation,” he said. Sarah Longlands, the chief executive of the Centre for Local Economic Strategies, said the denuding of TfN called into question the whole northern powerhouse concept, as envisaged by Osborne as chancellor. “I think it’s probably dead from a government point of view,” she said. “It has been clear, particularly through Covid, that this government has a centralising agenda … The verdict is out on whether they want to be associated with the northern powerhouse, but if it’s not dead it’s on life support.” A rail expert said until now TfN had received about £60m a year to pay consultants, Network Rail (soon to become Great British Railways) and HS2 Ltd to develop NPR, but now this money would go straight to Network Rail to develop it. The government cut TfN’s core funding by 40% earlier this year, from £10m to £6m, and cancelled a project to introduce smart ticketing across the north. TfN’s chief executive, Barry White, left shortly afterwards. The Guardian understands TfN will continue to receive a core grant from government in 2022-23 as well as limited funds to act as a “co-sponsor” of NPR. That means TfN will offer government strategic direction and advice on a range of issues including integration with local transport and infrastructure and opportunities for local development and regeneration. In a statement Tugwell defended TfN’s “demonstrable track record in developing evidence-led, cost-effective solutions that reflect the needs of the north’s communities”, and added it was essential NPR “continues to be shaped by the knowledge, insight and constructive challenge that underpins TfN’s work”. A spokesperson for the Department of Transport said: “As we deliver Northern Powerhouse Rail, as part of our £96bn investment into the railway, we must ensure there is clear accountability and oversight which provides significant benefits for passengers as quickly as possible. As with all major projects, the programme will be managed by the government.” Transport for the North will “continue to provide important strategic direction and advice”, they added.