Chancellor’s rail investment to transform city region connectivity
Chancellor Rachel Reeves has unveiled a landmark £15.6 billion investment in local transport, with a strong emphasis on expanding and modernising rail infrastructure across England’s city regions.
The announcement, made in Greater Manchester, marks the largest-ever commitment to regional rail and transit systems outside London and the South East.
The funding, part of the upcoming Spending Review, will more than double real-terms capital investment in local transport by 2029/30 compared to 2024/25. It aims to empower regional leaders to deliver transformative rail projects that improve connectivity, reduce journey times, and support economic growth.
In her speech, the Chancellor said:
“I can tell you today that we will be making the biggest ever investment by a British government in transport links within our city regions, and their surrounding towns; £15.6 billion in transport funding settlements, to be delivered by our regional mayors; More than doubling real-terms spending on city-region connectivity.”
The five-year funding settlements will support a series of ambitious rail and tram schemes, including:
- Metro rail extension from Washington to Newcastle and Sunderland, reconnecting communities and boosting access to jobs and education.
- Expansion of Greater Manchester’s Metrolink, with new tram stops in Bury, Oldham, and a long-awaited extension to Stockport town centre.
- West Yorkshire Mass Transit system, integrating rail with bus, cycling, and walking routes to create a seamless public transport network.
- South Yorkshire tram renewal, enhancing links between Sheffield and Rotherham to support housing and employment growth.
- Metro extension to Birmingham’s sports quarter, laying the groundwork for a wider East Birmingham–North Solihull rail corridor.
These projects are expected to create thousands of jobs, expand labour markets, and provide greener, more reliable alternatives to car travel.
The Chancellor also announced a fundamental shift in how the government evaluates regional infrastructure projects. Following a review of the Treasury’s Green Book, the new approach will ensure fairer consideration for rail investments in historically underfunded areas.
Transport Secretary Heidi Alexander added:
“Today marks a watershed moment on our journey to improving transport across the North and Midlands – opening up access to jobs, growing the economy and driving up quality of life as we deliver our Plan for Change.
“For too long, people in the North and Midlands have been locked out of the investment they deserve. With £15.6bn of Government investment, we’re giving local leaders the means to drive cities, towns and communities forward, investing in Britain’s renewal so you and your family are better off.”
The full Green Book review will be published on 11 June alongside the Spending Review.
For more investment conversations, make sure you connect with the north’s most important rail buyers and suppliers at TransCityRail North in November.
Image credit: iStock
