YORK has lost its bid to become the headquarters for Great British Railways (GBR), costing the city an estimated 1,600 new jobs and a £110 million boost to the economy.

Transport Secretary Mark Harper confirmed today that the HQ would be based in Derby, saying that among an 'exceptional' list of six shortlisted applicants, which included York,  Derby had scored highest in the 'expression-of-interest' stage of the competition.

He said this had analysed suitability against six published criteria: levelling up, connectivity, opportunities for GBR, value for money, heritage and public support.

"It also scored highest in the six-week public vote, attracting 45,600 votes, more than 5,000 ahead of the second placed location in a total vote of 205,000," he said.

"Derby will become the heart of Great Britain's rail industry, bringing together track and train, as well as revenue and cost.

"This means we will finally treat the railway as the whole system it should be rather than a web of disparate interests that it's become."

York's leaders said while campaigning last year for the HQ to be in the city that it would add an estimated £110 million to York’s economy and create 1,600 new jobs.

A Department for Transport spokesperson said today that while the headquarters would be in Derby, other towns and cities across Britain, potentially including the five shortlisted cities, would still benefit.

They said they would become 'powered up regional GBR hubs, equipped with local decision making, and investment powers aimed at benefiting their local communities and further creating jobs in the locations they serve.'

Anit Chandarana, Lead Director, Great British Railways Transition Team, gave a similar assurance, saying: “Although Derby will be the home of our headquarters, Great British Railways will also introduce empowered regional centres, to bring decision making and leadership much closer to local customers and communities."

Derby council leader Chris Poulter said the city was the only one in the UK to have manufactured rolling stock continuously since 1840, so he was 'thrilled that Derby's heritage is being recognised in this defining way.'

He added: "We can’t wait to see what this momentous move will mean for Derby and its citizens in the future.”

Today's announcement came after The Guardian had reported on Monday that Derby was expected to win the contest.

York had fought off stiff competition from 41 other British cities to join the shortlist of six contenders last year, the others being Derby, Birmingham, Crewe, Doncaster and Newcastle-upon-Tyne.

Council leader Keith Aspden said last year that with its 'rich rail heritage and growing rail sector and skills based in the city, we know that York is the natural home for rail.'

York Central MP Rachael Maskell said York led the rail industry in advanced and digital rail and had he skills ready to ensure GBR was a success from day one.