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Thank you Malcolm.

It鈥檚 a pleasure to be here and a welcome opportunity to talk about cross-border transport in the UK with so many expert and distinguished guests.

So thanks to Ross and everyone from SCDI for inviting me and I look forward to our discussion later.

It鈥檚 a discussion which takes on added significance now we are just 8 months away from the Scottish referendum.

Indeed, transport is an important part of the independence debate. I think people on both sides of that debate agree that if Scotland is to flourish in the future it needs to be an outward facing nation.

A country that welcomes people and investment from abroad that builds strong connections with international partners and that鈥檚 wired into the global economy.

But where we differ from the pro-independence lobby is that we believe Scotland has a better chance of achieving those goals if it鈥檚 part of the United Kingdom

Part of a bigger, more powerful block in which people and goods can all move freely, unconstrained by international borders, where devolved administrations work alongside the Westminster government on a shared vision to improve transport throughout the UK.

The challenge of the future is how to grow in a balanced way.

How to build a joined up economy.

How to make the whole of the UK more competitive and resilient.

And one of the most effective ways to do that is to invest in transport.

We鈥檝e spent decades neglecting our transport system adopting a 鈥榩atch and mend鈥� mentality.

In 2009, the World Economic Forum ranked us 33rd in the world for the quality of its infrastructure. For much of the previous decade, the UK had been the lowest infrastructure investor of all the OECD countries. So even in good times, when money was plentiful, we failed to close the infrastructure gap with our competitors.

Somewhere along the way, we forgot the lessons of the Victorian era.

How good infrastructure becomes part of the fabric of the country.

How it keeps paying back, generation after generation.

But finally things are changing.

Today, we have a national infrastructure programme.

We鈥檙e tackling the slow, unpredictable and costly planning system, we鈥檙e raising the profile of transport in government, we鈥檙e getting different departments, different sources of funding, and different regions to work together.

And working with the devolved administrations, we鈥檙e reversing decades of underinvestment to benefit the whole of the UK.

Take rail.

We鈥檝e embarked on the biggest rail modernisation programme since the Victorian era.

Network Rail will invest 拢38 billion between 2014 and 2019.

And many of the improvements will be felt north of the border.

The Intercity Express programme, for example, includes 拢2.8 billion for a new fleet of bi-mode trains on the East Coast line.

That will improve reliability, journey times, capacity, and comfort on services from London to Scotland.

We鈥檙e upgrading the West Coast and East Coast infrastructure.

We鈥檙e co-funding the Caledonian Sleeper with the Scottish government.

And we鈥檙e investing in better rail freight links.

Together, these measures will make a massive difference to services.

But they won鈥檛 be enough to absorb rising demand on our main north-south routes in the longer term.

Those lines between England and Scotland are not just the most important rail routes in the UK. They鈥檙e also the busiest.

Hardly surprising if you haven鈥檛 built a new north-south line in 120 years and we鈥檙e going to keep on travelling more and more.

That鈥檚 why we need HS2.

A genuinely national network, the backbone of the UK, that will connect Scotland, north England, the Midlands, and London.

Phases One and Two are crucial steps towards that goal.

Boosting capacity by nearly 20,000 passengers an hour.

From the day these lines open, Scotland will benefit.

With seamless movement of high speed trains onto the West and East Coast Main lines cutting the journey times from Edinburgh and Glasgow to London by up to an hour.

This will boost the Scottish economy by around 拢3 billion.

But the benefits of high speed rail will accrue as the network grows.

Our objective is a national network that will bring the constituent parts of the UK closer together in a way we haven鈥檛 seen since the coming of the motorways.

So we warmly welcome the support and enthusiasm for high speed rail in Scotland.

We鈥檝e instructed HS2 Ltd to identify options to make further capacity and journey time improvements between northern England and Scotland - including how to reduce the trip from Glasgow and Edinburgh to London to 3 hours or less.

We have a good relationship with the Scottish government. Which sits on the high speed rail steering group and we鈥檒l continue to work closely together as Scotland develops its own high speed plans.

Like rail, we plan aviation with the whole of the UK in mind, as it鈥檚 so crucial to our national prosperity and to the growth of every region.

Scotland鈥檚 geography means it鈥檚 particularly reliant on its air connections. Not just from Edinburgh, Glasgow and Aberdeen but also from places like Inverness, Wick, and the islands.

It鈥檚 important to address the connectivity gap wherever it exists and not just on international flights.

There鈥檚 strong demand for routes to the UK鈥檚 main hub airport, Heathrow, too.

So we recognise that Scotland has a significant interest in the outcome of the Airports Commission as it examines options for maintaining the UK鈥檚 status as a global air hub.

The commission鈥檚 interim report was delivered before Christmas.

At this stage we do not intend to comment on any of the shortlisted options which include - but are not restricted to - adding capacity at Heathrow.

But what I can say is that our strategy going forward will be one that best meets the needs of the entire country.

That鈥檚 also an objective of our aviation policy framework.

And it鈥檚 why we have a mechanism for protecting key routes.

Normally in this country, airlines decide which routes they serve based on market conditions. Government does not intervene.

But we can step in if devolved administrations like Scotland apply to protect particular existing air links to London through public service obligations (PSOs).

As part of the Spending Round, we announced 拢20 million to maintain regional services to London where there is a risk that connectivity may be lost.

And we published guidance clarifying the process.

But it is for the Scottish administration to determine the business and legal case on a PSO, and to apply for support.

Our roads programme also affects Scotland.

We are investing in the biggest upgrade to the network for half a century, including a tripling of the national roads budget.

We鈥檙e adding 400 more lane miles of motorway and we鈥檙e improving the A1 in north Yorkshire.

We鈥檒l publish the results of a feasibility study into dualling the A1 north of Newcastle to Scotland later this year.

Lots of other transport services we provide are UK-wide in scope like driving tests, vehicle inspections, coastguards, aviation security and accident investigations.

My message tonight is simple.

We鈥檙e better together.

Together, we鈥檝e become one of the fastest growing economies in the Western world.

Together, we are modernising the UK鈥檚 transport infrastructure, reversing decades of underinvestment, linking up the country to secure long-term growth and rebalance our economy.

I don鈥檛 believe that creating an unnecessary international border where movement by road, rail, sea and air has to be controlled is the best way forward.

For Scotland or for the UK.

We have a fantastic opportunity here to put the difficulties of the past behind us and build a better future.

So let鈥檚 grasp it together.

Thank you.