Unblocking the rail enhancement pipeline to support economic growth

Many of these are ‘zombie projects’ they haven’t yet been killed off but are not exactly showing many signs of life either. Yet, from the collection of interventions originally under the Northern Powerhouse Rail umbrella, through to other smaller programmes such as increasing freight capacity through Ely Junction, these regional schemes are vital to the government’s ambition of supporting economic growth.

There was positive news in the budget with commitments for some of the larger rail schemes including East West Rail, bringing HS2 to Euston, and the Trans Pennine Route upgrade. Some of the other budget announcements will also make major improvements in infrastructure delivery. However, we are yet to see the detail of how some of this will work and whether there will be sufficient funding available to get many other regional rail infrastructure schemes underway.

There are three key areas which need focus to create a coherent and sustainable pipeline of rail enhancements which will improve outcomes for passengers and drive economic growth.

‘Long-termism’: providing a sustained period of stability to allow projects to develop

The government aims to move away from short-term decision making and confirmed that it will produce a 10-year infrastructure strategy by spring 2025. In addition, it is creating a new body, combining the National Infrastructure Commission (NIC) and the Infrastructure and Projects Authority (IPA), to help oversee the development and implementation of that strategy alongside input from industry. This will be published alongside a multi-year spending review, where the government will set out 5-year capital budgets for departments to reduce the cliff-edge funding issues.

Within these structures, government needs to create a clear pipeline of expected rail schemes. This should provide transparency and stable budgets, a consistent set of scheme objectives, and the ability for projects to adapt and evolve within given parameters. This approach will remove some of the political headwinds and create a predictable environment over a sustained period which will allow them to move forward.

Vision-led: aligning rail infrastructure investment with wider cross-government outcomes

These long-term structures are a big step in the right direction, but the real opportunity lies in aligning rail investment with other wider government, and potentially private sector, investment to achieve cross-cutting societal benefits.

The 10-year infrastructure strategy should provide greater opportunities to assess how rail investments interact with other related infrastructure. Rail investment should be considered as part of a wider portfolio, including housing, roads and energy, to support economic growth. Therefore, rather than appraising schemes as a sequence of seemingly unrelated investments, there needs to be greater consideration of the overall system, and the part that rail can play as a catalyst for wider investment.

This approach could also enable greater private sector investment, especially where rail development can support wider commercial activity such as property development or passenger focussed revenue opportunities.

Devolved responsibility: integrating regional schemes to meet national objectives

As part of the budget, the government announced that Greater Manchester and West Midlands Combined Authorities will receive integrated settlements at the start of the 2025-26 financial year, with a further four Mayoral Combined Authorities included from 2026-27. This approach provides mayoral authorities with greater control and responsibility to deliver transport schemes across their regions.

This trend towards greater devolution, provides the chance to improve outcomes for passengers and deliver more joined-up transport solutions. They can ensure that rail schemes align with both investment in other modes (e.g. mass transit) and other social initiatives such as redevelopment around railway stations.

However, as devolved bodies take greater ownership of rail schemes, they will still need to work closely with both the Department of Transport and sub-national transport bodies. Clarity of roles and responsibilities will be critical to ensure objectives align, and that projects don’t get caught up in a governance quagmire. Otherwise, developments risk being held up as they spend a huge amount of time optioneering and agreeing approaches with different parties. Funding options may also become more complex, with the need for joint sponsorship between national and local government.

While the budget provides a way to unblock rail investment, more work needs to be done to ensure this investment delivers the desired outcomes. Getting this right will help build the confidence of both the rail sector and wider industry, create better outcomes for passengers, and play a significant part in delivering economic growth.