New figures released by HM Treasury reveal a £3.2 billion underspend on infrastructure and construction projects across the UK during the 2024–25 financial year, sparking concerns over delivery delays and missed opportunities for economic growth.
The data shows that the Department for Transport recorded an underspend of £264 million from its £6.8 billion baseline budget, affecting a range of transport schemes. Among the most impacted projects is Northern Powerhouse Rail, which saw just £80.59 million spent from its £132 million allocation, leaving £51 million unspent.
This shortfall contributed to the National Infrastructure & Service Transformation Authority issuing a red deliverability rating, indicating the project “appears unachievable” under current conditions.
- Northern Powerhouse Rail: £51 million underspend
- Midland Main Line Electrification: £10 million underspend due to project pause
The figures raise questions about the pace and prioritisation of infrastructure investment, particularly in regions where transport upgrades are critical to levelling up, economic regeneration, and net zero goals.
Darren Caplan, Chief Executive of the Railway Industry Association, said:
"Whilst we recognise the Government’s commitments to rail investment announced over the last year, this underspend reported by NISTA is concerning as it includes vital investment needed to build rail infrastructure needed for the future and which the UK’s world-class rail supply sector would have been working to deliver.
“Specifically on major rail schemes like Northern Powerhouse Rail, NISTA has now determined that the development of this ‘appears unachievable’. East West Rail and Midland Mainline have also encountered investment difficulties. So we ask the Government to announce its long-term strategy for rail and rolling stock as soon as possible to give clarity to the railway industry, and to ensure the amounts committed to the various projects are spent efficiently.”
Infrastructure spending is a key driver of productivity, job creation and regional development. The underspend risks delaying vital improvements to rail connectivity, urban mobility, and green transport infrastructure, especially in the North and Midlands.
The Treasury’s data will likely prompt calls for greater transparency, improved project management, and accelerated delivery to ensure allocated funds are fully utilised.
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