THE "Northern Way" is one of those initiatives that most business people know about, but would be hard-pushed to describe in any detail.

That is a pity because it is, potentially, hugely important. Its very existence is a response to the well-hyped £30 billion output gap between the north and south, which is still widening.

It reflects a desire by the Deputy Prime Minister, John Prescott, "to capitalise on the north's new-found confidence and energy, and to speed up the rate of change".

He said: "Our aim is simple - to establish the north of England as an area of exceptional opportunity, combining a world class economy with a superb quality of life."

So, in headline terms, the Northern Way aims to unlock the potential of the north by adding value through pan-regional working; building on combined assets and networks; and creating a world class critical mass.

The obvious question, then, is: "How well is it all going?" The answer is less apparent, although it might be argued that it is still early days. A trawl through relevant, but often dated, websites reveals much hand-waving but, as yet, rather little clear action.

This was no doubt behind the criticism from the Federation of Small Businesses, late last year, that the Northern Way initiative needs to focus more on seven crucial areas. It identified crime, planning, transportation, education, employment, entrepreneurship and business impact on small firms as key issues, and argued not enough is being done to ensure York companies get the best deal out of the Northern Way.

For its part, the Northern Way has identified ten investment priorities to:

bring more people into employment

strengthen the north's knowledge base and drive innovation

build a more entrepreneurial north

capture a larger share of global trade

meet employer skills needs

prepare a Northern Airports Priorities Plan and improve surface access to key northern airports

improve access to the north's seaports

create premier transit systems in each city region and stronger linkages between city regions

create truly sustainable communities

market the north to the world.

A Northern Way Summit, held at the Royal York Hotel in February, received an update of progress and proposed actions, including "a Knowledge Transfer Partnership already underway with the health sector" (that's good, but hardly the ground-breaking stuff needed to transform the much-hyped £30 billion productivity gap); a National Academy for Sustainable Communities will be located in Leeds; and there will be marketing campaigns in Australia and North America to encourage more visitors and investment.

Perhaps one of the most important contributions of the Northern Way will be to resource and energise the so-called N8 group of northern universities so that they can produce greater impact on businesses and economic development.

This N8 group, comprising Durham, Lancaster, Leeds, Liverpool, Manchester, Newcastle, Sheffield and York universities, has a total turnover of £2.75 billion and a combined research income of £620 million, which is comparable with Oxford, Cambridge and London universities - the Golden Triangle - all put together.

Early themes that will exploit unique research strengths among the N8 include ageing and health; energy research and development; foresight and sustainable water use; a molecular engineering tool kit; and regenerative medicine.

It is good to know that York, with its Science City status and thriving university, is well-positioned both to contribute to, and also to take advantage of, the Northern Way initiative.

But it is also important that York does not lose out, yet again, to benefits provided elsewhere in the region or across the north of England.

Neville Chamberlain, the recently-appointed chairman of the Northern Way after the early resignation of former chairman, Sir Graham Hall, has had little time to show some significant progress.

But Dr Chris Henshall, pro vice-chancellor for external relations at the University of York, reports some small but significant progress in the attempt to increase the northern economy by about £29 billion to redress the imbalance of the north-south divide.

He says that the N8 Northern Research Partnership is in discussions with the Northern Way about the establishment of a number of flagship research and innovation centres to build upon our world-leading research strengths and translate them into economic advantage.

He said: "York is fully involved in this work. And we have just heard that the Northern Way Steering Group has agreed to make a sum of more than £2 million available to Science City York to allow it to strengthen its support for the creation of jobs in knowledge-based companies in and around the city.

"This is excellent news for York and the local and regional economies."

Updated: 10:42 Wednesday, April 19, 2006