Reeves pledges £15.6bn for transport investments across city regions
Chancellor Rachel Reeves has announced £15.6 billion of funding for local transport projects in England’s city regions – including South Yorkshire, the North East, the East Midlands and Tees Valley, representing the largest ever investment in city region transport.
The five-year settlements represents a more than double real-terms increase in capital spending on local transport in city regions by 2029/30 compared with 2024/25.
In a speech in Greater Manchester, Reeves said that “a Britain that is better off cannot rely on a handful of places forging ahead of the rest of the country”, adding that the “result of such thinking has been growth created in too few places, felt by too few people and wide gaps between regions, and between our cities and towns”.
Also in Manchester, Transport Secretary Heidi Alexander described the investment as a watershed moment. “We’re giving local leaders the means to drive cities, towns and communities forward, investing in Britain’s renewal. This long-overdue investment outside of London and the South East will see projects like the Metro extension linking Washington to Newcastle and Sunderland and the renewal South Yorkshire’s tram network linking employment and housing areas in Sheffield and Rotherham get off the ground - creating jobs, better commutes, bigger labour markets and more opportunity.”
The Chancellor also announced “a step change in how government approaches and evaluates the case for investing in our regions” following a review of the Treasury’s Green Book and how it is used, “to make sure that this government gives every region a fair hearing when it comes to investments”.
The full conclusions of the Green Book review will be published on June 11, alongside the wider Spending Review when the government will outline its investment priorities for what it calls the "renewal of Britain".
Henri Murison, Chief Executive of the Northern Powerhouse Partnership said, “This government’s decision to back major local transport projects with serious, long-term investment will be critical to driving regional growth. The economic revival of Greater Manchester, enabled by sustained investment in the tram network in particular, has already begun to close the productivity gap with London. To build on that success and replicate it across all our regions in the North, we need to see key projects delivered – including the extension of the Metro to Washington, the replacement of the Sheffield tram fleet, and the extension of Metrolink to Stockport.
“Too many times in the past, a trade-off was made – due to limited funding – between connectivity within and between our regions. The spending rules adopted last autumn mean this government can invest in both at the same time, unlocking far greater productivity gains than prioritising one at the expense of the other.”
Transport funding for City Regions:
West Midlands - £2.4 billion: Metro extension connecting Birmingham City Centre to new sports quarter
Greater Manchester - £2.5 billion: Metrolink expansion with new stops in Bury, Manchester and Oldham, plus 1,000 new electric buses
West Yorkshire - £2.1 billion: West Yorkshire Mass Transit development starting by 2028
East Midlands - £2.0 billion: New mass transit system connecting Derby and Nottingham
North East - £1.8 billion: Metro extension linking Newcastle and Sunderland via Washington
Liverpool City Region - £1.6 billion: Bus rapid transit routes and new fleet for franchised bus network
South Yorkshire - £1.5 billion: £530m for tram network renewal and £350m for bus reform
Tees Valley - £1.0 billion: Platform extension at Middlesbrough station
West of England - £0.8 billion: Rail infrastructure improvements and mass transit development