The government has started to deliver the tools we have asked for: meaningful devolved control and long-term funding certainty
Liverpool City Region has a multi-modal vision
For years, the transport sector has presented its wish list to successive governments with the perennial optimism of a true believer. At the top were three simple but profound requests: long-term funding certainty, meaningful devolved control, and investment that is commensurate to truly support transport’s role in driving economic growth.
In 2025, we have seen a substantive policy shift that goes someway to answering our long-held requests. This year’s funding announcements for local transport represent more than just money; they mark a genuinely transformational moment for public transport and the communities it serves. There has been a shift towards long-term certainty and local control, a central focus of our work at the Urban Transport Group (UTG).
The engine of our economy
High-quality public transport is not simply a “nice-to-have”; it is a fundamental enabler of economic growth, social equity and environmental sustainability.
For too long, lower levels of investment have been viewed as savings, when in reality, this is a multi-billion pound drag on our national economy. For example, poor public transport connectivity currently costs the UK economy more than £23.1bn every year. Whereas the benefits of investment are clear: a typical package of investment to improve bus infrastructure and services generates returns of £4.55 for every £1 invested. And the UK’s rail system contributes over £43bn annually to the economy and supports around 710,000 jobs.
Beyond the balance sheet, transport is a vital tool for social justice. It breaks down barriers to opportunity, especially for the 22% of households in England that do not have access to a car – a figure that rises to 40% for those in the lowest income quintile. This clearly shows that investing in local transport is a direct investment in a fairer, more prosperous society.
A funding revolution?
The most significant development in 2025 has been the government’s shift away from inefficient, short-term competitive bidding cycles to multi-year funding settlements. Now, it is important to credit the last government for the work they did on pushing forward bus reform (Bus Services Act 2017) and for pursuing local devolution – setting the groundwork for where we are today. However, when we analyse how these reforms were funded, we were stuck in a perpetual stop-start cycle that made strategic planning almost impossible.
That has now changed!
A significant amount of work has been undertaken to make this happen – whether through the work we have done at UTG and that of our members, the efforts of partners across the transport sector, civil servants and advisors in government, or our mayors and ministers. This year’s funding and policy announcements finally provide evidence of
a paradigm shift to multi-year, medium to long-term funding settlements, allowing local areas to plan, invest, and deliver on their ambitions with greater confidence.
For our members, there have been two landmark components: a confirmed national bus revenue settlement of £481m per year through to 2029, providing unprecedented stability for the day-to-day running of essential services. And a £15.6bn “Transport for City Regions” (TCR) capital pot for 2027-32, providing a long-term fund for building new infrastructure, from tram lines to strategic bus corridors.
As important as money is, the true innovation lies in the shift toward empowering transport authorities and Mayoral Strategic Authorities (MSAs), enabling them to make strategic infrastructure decisions that should reduce long-term uncertainty and create a sustainable foundation for growth.
The dawn of the ‘integrated’ era
There is no better example to highlight this than the introduction of the “Integrated Settlement” for six of our members outside of London. This marks a move away from siloed grants, instead consolidating transport funds for bus revenue, capital projects, and maintenance into a single flexible pot over which mayors have strategic control. This is alongside money for skills, housing, economic development and the environment.
This new landscape is the culmination of a long policy journey towards genuine devolution, a powerful endorsement of a principle that we at UTG have long championed: The fundamental belief underpinning devolution is that local needs are best served by local decision-making informed by local knowledge.
With devolution, the focus is now shifting from what powers and funding we need, to the scale of what we can achieve
This flexibility empowers mayors to think about place more broadly, connecting transport investment directly with wider local priorities like building new homes and driving economic regeneration. This is not a theoretical benefit; the model is already proven across the country. London’s Elizabeth line has directly contributed to the delivery of 55,000 new homes, while in the Liverpool City Region, an investment of £1.6bn in transport will look to deliver a new station at the Baltic Exchange, new rapid transit routes and an expansion in active travel across the region. This is the level of strategic integration that devolved funding unlocks.
From vision to reality
We no longer need to speak of devolution in the abstract – it is already delivering on the ground. Greater Manchester’s iconic Bee Network is a tangible symbol of this new era for English regions. Enabled by devolved powers, all local bus routes came under local control in January 2025. With its yellow livery and the introduction of integrated ‘tap and go’ ticketing across bus and tram, it is creating the seamless, London-style user experience that passengers deserve.
Crucially, this is not a one-size-fits-all solution. Greater Manchester’s success does not mean franchising is the only answer. Devolution supports a plurality of delivery models, and the success of strong Enhanced Partnerships – such as the data-led, ‘one-team approach’ in Portsmouth or the mixed market model in the East Midlands, with a municipal operator and market-led partnerships. This demonstrates that different localities can find the right model to raise standards.
Rail – the final jigsaw piece
With medium to long-term funding secured and bus reform beginning to deliver positive outcomes, the final piece of the jigsaw is coming into view: a railway fit for the future. The government’s commitment to establishing Great British Railways (GBR) presents a generational opportunity to reshape our railways.
The most crucial part of this reform is the pledge that devolved leaders will have a statutory role in the new railway. For too long, a centrally-controlled railway has operated in a silo. This reform is the key that has the potential to unlock the ambition of transport networks like the Bee Network, allowing not just integration of local rail services, but local control.
Now there is further work required to strengthen the Railways Bill, to ensure it will truly meet the aspirations of our members and to deliver the outcomes the government wants – a more responsible, accountable and passenger focused railway. If we get this piece of legislation right, a reformed railway working in-step with local leaders will enable a truly integrated vision for the future: a single, seamless transport experience across bus, tram, and train, with integrated fares and coordinated timetables under a single, trusted local brand, with the opportunity to align with wider plans for economic growth, locally and nationally
Conclusion: The world is our oyster
2025 will be remembered as a landmark year for local transport. The government has started to deliver the tools we have long asked for: a policy landscape rooted in devolution with significant, long-term and devolved funding that provides certainty and empowers local leaders.
However, there is always more to do.
The next Spending Review is only a few years away, at which point it is important that we secure a better alignment of funding for revenue and capital over a longer period than three or five years. Fiscal devolution must go further, not least to deliver local rail ambitions. And in the policy space, aside from rail, we must continue to work with government on delivering the highly anticipated national transport strategy, harnessing the benefits of micromobility, expanding light rail, delivering a better offer for fares and ticketing, and harnessing the benefits of data in the new AI digital age. This is on top of championing public transport, cycling, walking and wheeling – doing our best to ensure that people feel the benefits of investing in public transport each and every day.
For years, the debate was about long-term funding, devolved control and recognising transport’s role in driving economic growth. That debate is (almost) over. With devolution, the focus is now shifting from what powers and funding we need, to the scale of what we can achieve.
ABOUT THE AUTHOR: Jason Prince became director of the Urban Transport Group, the UK’s network of city region transport authorities, in July 2023. He was previously head of public affairs for the Greater Manchester Combined Authority, a position he has held for over three years, and prior to that, he worked for Transport for Greater Manchester.
This story appears inside the latest issue of Passenger Transport.
A landmark year for local transport
by Passenger Transport on Dec 12, 2025 • 2:55 pm No CommentsThe government has started to deliver the tools we have asked for: meaningful devolved control and long-term funding certainty
For years, the transport sector has presented its wish list to successive governments with the perennial optimism of a true believer. At the top were three simple but profound requests: long-term funding certainty, meaningful devolved control, and investment that is commensurate to truly support transport’s role in driving economic growth.
In 2025, we have seen a substantive policy shift that goes someway to answering our long-held requests. This year’s funding announcements for local transport represent more than just money; they mark a genuinely transformational moment for public transport and the communities it serves. There has been a shift towards long-term certainty and local control, a central focus of our work at the Urban Transport Group (UTG).
The engine of our economy
High-quality public transport is not simply a “nice-to-have”; it is a fundamental enabler of economic growth, social equity and environmental sustainability.
For too long, lower levels of investment have been viewed as savings, when in reality, this is a multi-billion pound drag on our national economy. For example, poor public transport connectivity currently costs the UK economy more than £23.1bn every year. Whereas the benefits of investment are clear: a typical package of investment to improve bus infrastructure and services generates returns of £4.55 for every £1 invested. And the UK’s rail system contributes over £43bn annually to the economy and supports around 710,000 jobs.
Beyond the balance sheet, transport is a vital tool for social justice. It breaks down barriers to opportunity, especially for the 22% of households in England that do not have access to a car – a figure that rises to 40% for those in the lowest income quintile. This clearly shows that investing in local transport is a direct investment in a fairer, more prosperous society.
A funding revolution?
The most significant development in 2025 has been the government’s shift away from inefficient, short-term competitive bidding cycles to multi-year funding settlements. Now, it is important to credit the last government for the work they did on pushing forward bus reform (Bus Services Act 2017) and for pursuing local devolution – setting the groundwork for where we are today. However, when we analyse how these reforms were funded, we were stuck in a perpetual stop-start cycle that made strategic planning almost impossible.
That has now changed!
A significant amount of work has been undertaken to make this happen – whether through the work we have done at UTG and that of our members, the efforts of partners across the transport sector, civil servants and advisors in government, or our mayors and ministers. This year’s funding and policy announcements finally provide evidence of
a paradigm shift to multi-year, medium to long-term funding settlements, allowing local areas to plan, invest, and deliver on their ambitions with greater confidence.
For our members, there have been two landmark components: a confirmed national bus revenue settlement of £481m per year through to 2029, providing unprecedented stability for the day-to-day running of essential services. And a £15.6bn “Transport for City Regions” (TCR) capital pot for 2027-32, providing a long-term fund for building new infrastructure, from tram lines to strategic bus corridors.
As important as money is, the true innovation lies in the shift toward empowering transport authorities and Mayoral Strategic Authorities (MSAs), enabling them to make strategic infrastructure decisions that should reduce long-term uncertainty and create a sustainable foundation for growth.
The dawn of the ‘integrated’ era
There is no better example to highlight this than the introduction of the “Integrated Settlement” for six of our members outside of London. This marks a move away from siloed grants, instead consolidating transport funds for bus revenue, capital projects, and maintenance into a single flexible pot over which mayors have strategic control. This is alongside money for skills, housing, economic development and the environment.
This new landscape is the culmination of a long policy journey towards genuine devolution, a powerful endorsement of a principle that we at UTG have long championed: The fundamental belief underpinning devolution is that local needs are best served by local decision-making informed by local knowledge.
This flexibility empowers mayors to think about place more broadly, connecting transport investment directly with wider local priorities like building new homes and driving economic regeneration. This is not a theoretical benefit; the model is already proven across the country. London’s Elizabeth line has directly contributed to the delivery of 55,000 new homes, while in the Liverpool City Region, an investment of £1.6bn in transport will look to deliver a new station at the Baltic Exchange, new rapid transit routes and an expansion in active travel across the region. This is the level of strategic integration that devolved funding unlocks.
From vision to reality
We no longer need to speak of devolution in the abstract – it is already delivering on the ground. Greater Manchester’s iconic Bee Network is a tangible symbol of this new era for English regions. Enabled by devolved powers, all local bus routes came under local control in January 2025. With its yellow livery and the introduction of integrated ‘tap and go’ ticketing across bus and tram, it is creating the seamless, London-style user experience that passengers deserve.
Crucially, this is not a one-size-fits-all solution. Greater Manchester’s success does not mean franchising is the only answer. Devolution supports a plurality of delivery models, and the success of strong Enhanced Partnerships – such as the data-led, ‘one-team approach’ in Portsmouth or the mixed market model in the East Midlands, with a municipal operator and market-led partnerships. This demonstrates that different localities can find the right model to raise standards.
Rail – the final jigsaw piece
With medium to long-term funding secured and bus reform beginning to deliver positive outcomes, the final piece of the jigsaw is coming into view: a railway fit for the future. The government’s commitment to establishing Great British Railways (GBR) presents a generational opportunity to reshape our railways.
The most crucial part of this reform is the pledge that devolved leaders will have a statutory role in the new railway. For too long, a centrally-controlled railway has operated in a silo. This reform is the key that has the potential to unlock the ambition of transport networks like the Bee Network, allowing not just integration of local rail services, but local control.
Now there is further work required to strengthen the Railways Bill, to ensure it will truly meet the aspirations of our members and to deliver the outcomes the government wants – a more responsible, accountable and passenger focused railway. If we get this piece of legislation right, a reformed railway working in-step with local leaders will enable a truly integrated vision for the future: a single, seamless transport experience across bus, tram, and train, with integrated fares and coordinated timetables under a single, trusted local brand, with the opportunity to align with wider plans for economic growth, locally and nationally
Conclusion: The world is our oyster
2025 will be remembered as a landmark year for local transport. The government has started to deliver the tools we have long asked for: a policy landscape rooted in devolution with significant, long-term and devolved funding that provides certainty and empowers local leaders.
However, there is always more to do.
The next Spending Review is only a few years away, at which point it is important that we secure a better alignment of funding for revenue and capital over a longer period than three or five years. Fiscal devolution must go further, not least to deliver local rail ambitions. And in the policy space, aside from rail, we must continue to work with government on delivering the highly anticipated national transport strategy, harnessing the benefits of micromobility, expanding light rail, delivering a better offer for fares and ticketing, and harnessing the benefits of data in the new AI digital age. This is on top of championing public transport, cycling, walking and wheeling – doing our best to ensure that people feel the benefits of investing in public transport each and every day.
For years, the debate was about long-term funding, devolved control and recognising transport’s role in driving economic growth. That debate is (almost) over. With devolution, the focus is now shifting from what powers and funding we need, to the scale of what we can achieve.
ABOUT THE AUTHOR: Jason Prince became director of the Urban Transport Group, the UK’s network of city region transport authorities, in July 2023. He was previously head of public affairs for the Greater Manchester Combined Authority, a position he has held for over three years, and prior to that, he worked for Transport for Greater Manchester.
This story appears inside the latest issue of Passenger Transport.
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