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In a landmark announcement poised to reshape Britain's economic landscape, Chancellor Rachel Reeves today unveiled a colossal £15.6 billion investment package dedicated to public transport infrastructure across the North and Midlands, signaling a decisive shift away from London-centric Treasury policies.
Speaking in Manchester, Ms. Reeves declared that Britain "cannot rely on a handful of places forging ahead of the rest of the country," championing a "new economic model – driven by investment in all parts of the country." This significant financial commitment aims to address long-standing criticisms that Treasury rules have historically favored the South East, neglecting the immense potential of other regions.
A cornerstone of this new strategy will be fundamental changes to the Treasury’s "Green Book" rules, which dictate how government projects receive funding. These rules have faced widespread criticism for their alleged "hardwired London bias," as noted by Labour MP Jeevun Sandher of the Commons Treasury Committee. Ms. Reeves is expected to confirm these revisions in the upcoming spending review on June 11, asserting that the changes will ensure the Government "gives every region a fair hearing when it comes to investments."
The ambitious transport package includes vital funding for key regional projects: extensions to the successful metros in Tyne and Wear, Greater Manchester, and the West Midlands; a revitalized tram network for South Yorkshire; and the development of a new mass transit system in West Yorkshire. These investments are set to unlock improved access to jobs, stimulate economic growth, and enhance the quality of life for millions outside the capital.
The move also carries significant political implications, particularly for the "Red Wall" constituencies in the North and Midlands, where Labour MPs are facing increasing electoral pressure from Reform UK. By directing substantial investment to these areas, Labour aims to demonstrate its commitment to leveling up the country and addressing regional inequalities.
Transport Secretary Heidi Alexander hailed the announcement as a "watershed moment on our journey to improving transport across the North and Midlands," emphasizing its potential to open up access to jobs, grow the economy, and drive up quality of life.
However, the comprehensive regional investment comes alongside reports that ministers are also set to approve over £1 billion in public funding for the Lower Thames Crossing as part of next week’s spending review. This sum is intended to help unlock private investment for the £10 billion road tunnel connecting Kent and Essex, highlighting a continued, albeit perhaps rebalanced, commitment to infrastructure projects in the South East.
Some of the projects now receiving backing, such as the West Yorkshire mass transit network, were initially part of Rishi Sunak’s "Network North" plan, conceived as a compensatory measure after the controversial decision to scrap the HS2 line north of Birmingham. Today's announcement by Chancellor Reeves, however, signifies a much broader and more systemic approach to re-prioritizing regional investment, marking a significant shift in the government's economic agenda.
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