Chancellor’s move signals shift from London-centric funding model in major regional investment push
LONDON — Chancellor Rachel Reeves is set to announce a landmark £15.6 billion investment package in transport infrastructure across England’s regions on Wednesday, in a move designed to tackle long-standing geographical inequalities and address pressure within Labour ranks for a visible economic uplift.
The funding, part of a five-year allocation from 2027/28 to 2031/32, will benefit metro mayoral authorities across the Midlands, the North, and the West Country.
It marks the chancellor’s first major break from the Treasury’s traditional Green Book rules, which have long been criticised for disproportionately favouring London and the south-east in major investment decisions.
Key beneficiaries include Greater Manchester, receiving £2.5bn to extend its tram network to Stockport and expand stops in Bury, Manchester, and Oldham.
The West Midlands will receive £2.4bn to expand services from Birmingham city centre to a new sports quarter. West Yorkshire will see £2.1bn to begin work on its long-anticipated Mass Transit system by 2028, including new bus stations in Bradford and Wakefield.
In total, six more metro mayor regions will benefit from targeted funding:
South Yorkshire: £1.5bn to renew trams and buses in Sheffield, Doncaster, and Rotherham by 2027
Liverpool City Region: £1.6bn to improve airport links, bus fleets, and access to Everton and Anfield stadiums
North East: £1.8bn to extend the Newcastle to Sunderland tram via Washington
West of England: £800m for rail upgrades and a regional mass transit corridor across Bristol, Bath, and Somerset
Tees Valley: £1bn, including £60m to expand platforms at Middlesbrough station
East Midlands: £2bn to enhance road, rail, and bus links between Derby and Nottingham
The chancellor’s announcement comes just a week before the government’s spending review, which will set departmental budgets for the next three to four years.
Reeves has been under growing pressure from Labour MPs to inject optimism into a political landscape dominated by austerity rhetoric and criticism over cuts to disability benefits and social support.
Speaking in Manchester on Wednesday, Reeves is expected to argue that the existing Green Book rules have led to “growth created in too few places, felt by too few people,” reinforcing “wide gaps between regions.”
Her decision to revise the framework is also seen as a strategic move to shore up Labour support in so-called “Red Wall” seats that remain electorally vulnerable to Reform UK.
Transport Secretary Heidi Alexander described the investment as a “watershed moment” that would drive economic growth, unlock job opportunities, and enhance quality of life across northern England and the Midlands.
However, opposition voices urged caution. Liberal Democrat treasury spokeswoman Daisy Cooper said Reeves must now “deliver on her promises,” warning that communities had “heard these same pledges before” without seeing tangible outcomes.
She also called for action on fare reductions amid the ongoing cost of living crisis. The £15.6bn package, the Treasury confirmed, will double annual regional transport spending from £1.14bn in 2024-25 to £2.9bn by the end of the decade.
