"The prospects of meeting ambitions for the North" will be reduced because of the decision to reduce HS2 and cut Northern Powerhouse Rail, a report by MPs has concluded.
The Transport Select Committee also said the evidence base for the £96bn Integrated Rail Plan is "insufficient" while the proposals "have already left some towns and cities very disappointed".
In a newly-published report , the committee addressed the reduction of the HS2 Eastern Leg and the choice of option 1 for Northern Powerhouse Rail (NPR) and said it would limit the "vital capacity needed for growth".
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The report said: "The original purpose of NPR was to connect these great cities of the North and enable them to grow; latterly rail is central to the Government’s ambition to level up the country.
"The evidence base for the IRP must be reconsidered in the light of these aims, if this once-in-a-generation investment in rail is not to be a missed opportunity."
It added: "It is crucial that decisions on how to spend this investment are based on the fullest possible evidence for what will bring the greatest overall benefit to rail services, to the economy, to the environment and to communities across the North and Midlands.
"We are concerned that the evidence base for the IRP is insufficient to fully understand and substantiate the decisions contained in it."
The committee report also states that an updated benefit-cost ratio (BCR) has not been calculated for HS2 without the full Eastern leg.
The MPs have called on the Government to publish updated BCRs, using methodology that "fully reflects impacts on regional inequalities", by March 2023.
The committee said this is "essential to give confidence that changes to the HS2 Eastern leg have been properly assessed".
It adds that a full analysis of the wider economic impacts of the different Northern Powerhouse Rail options is needed and that BCR analyses must be produced for all NPR options.
The report said: "Upgrading lines will bring modest benefits, but not to the transformative extent needed to end regional imbalances.
"The Government must remain open to the possibility that options 2 or 3 for Northern Powerhouse Rail would represent the best potential value: this would be consistent with the spirit of commitments previously made by the Prime Minister to investigate all the options, and to allow the lead on what comes next to be taken locally."
The committee also said the Government must, by September this year, set out a timetable for its study on how best to take HS2 to Leeds.
It added that "this work is urgently needed to demonstrate that the commitment made to Leeds for high speed connections will be fulfilled".
The report also said: "Without adequate station infrastructure and capacity, the IRP’s aspirations for increasing capacity across the network would fall at the first hurdle.
"Several important stations are already over capacity and need development if they are to handle even the smallest of benefits under the IRP."
The committee has asked the Government to commit to supporting redevelopment of Leeds station by 2035 "so that it has sufficient capacity to accommodate planned additional services". It should "also reconsider" the case for the development of a new station in Bradford.
The MPs also said there is a "need for a renewed, transparent conversation" about the risks and benefits of the underground station option at Manchester Piccadilly.
The report added that as part of the review of the Midlands Rail Hub, the Government should commit to provision of the eastern chord in Birmingham.
The report also states: "The Government claims that the IRP will deliver improved journey times at a lower cost and to a quicker timescale than the plans it supersedes.
"Much of its success, therefore, depends on being able to deliver upgrades to cost and time, while minimising disruption, but doubts remain about the achievability of these benefits and strategies to mitigate disruption.
"The Government’s case for the IRP is based on a best-case scenario which may not come to pass."
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