Millions of people in the West Midlands will benefit from better public transport, reduced congestion and upgraded local bus and train stations as the Government continues to reallocate funding from HS2 to revolutionise transport, drive economic growth and transform communities.
Today (Monday 26 February), Prime Minister Rishi Sunak and Transport Secretary Mark Harper have confirmed that the West Midlands will receive a boost of almost £1.2 billion from April 2025 through the Local Transport Fund to improve the transport connections that so many people rely on every day, particularly across smaller cities, towns, and rural areas over seven years.
The new investment – made possible by reallocated HS2 funding – will deliver an unprecedented long term funding uplift across the region. It’s the first fully devolved transport budget of its kind for smaller cities, towns and rural areas which empowers local authorities to invest in the transport projects that matter most to their communities – helping create jobs, grow the economy, and level up the country.
Over the 7 years as a whole this funding will be on average at least 9 times more than these local authorities currently receive through the local integrated transport block which is the current mechanism for funding local transport improvements in their areas.
At Cabinet today, the Prime Minister is expected to call on Ministers and MPs to hold local authorities to account to ensure the funding is used appropriately and that the voices of local people are heard when decisions are made on where this funding goes and how this funding is spent.
Today’s almost £1.2 billion boost is the latest example of the Government’s plan to reallocate £36 billion from HS2 being delivered. This funding prioritises the forms of transport that matter most to people and will deliver for future generations – driving jobs, growing the economy, and levelling up the country.
Prime Minister Rishi Sunak said:
“We have a clear plan to level up our country with greater transport links that people need and deliver the right long term change for a brighter future.
“Through reallocating HS2 funding, we’re not only investing almost £1.2 billion directly back into our smaller cities, towns and rural areas across the West Midlands, but we are also empowering their local leaders to invest in the transport projects that matters most to them – this is levelling up in action.
“The Local Transport Fund will deliver a new era of transport connectivity. This unprecedented investment will benefit more people, in more places, more quickly than HS2 ever would have done, and comes alongside the billions of pounds of funding we’ve already invested into our roads, buses and local transport services across the country.”
The new investment is specifically for communities outside City Regions. Smaller cities, towns, villages, and rural areas all across the West Midlands, from Stoke-on-Trent and Staffordshire to Worcestershire and Warwickshire, will all receive a share of almost £1.2 billion.
The funding will be made available from 2025 to give local authorities enough time to develop their funding plans and prepare to hit the ground running to start delivering them as early as possible.
This investment will give local authorities long term certainty to invest in transformative and ambitious transport improvements from 2025 through to 2032 including:
- Building new roads and improving junctions
- Installing or expanding mass transit systems
- Improving roads by filling in potholes and better street lighting for personal safety
- Improving journey times for car and bus users by tackling congestion
- Increasing the number of EV chargepoints
- Refurbishing bus and rail stations
- Improving our streets so they are safer to walk children to school and increasing accessibility for all.
Councils will work with local MPs and will be held to account by the government as well as their communities to make sure the money is spent promptly and effectively. Local councils will be expected to publish their delivery plans for which projects they wish to invest in.
The government will support local authorities and hold them accountable for the delivery of their projects.
To ensure local authorities can make the most of this unprecedented funding, the Department will publish advice for local councils and transport authorities to help them develop ambitious plans to improve local transport infrastructure in their areas.
The new funding comes as devolution deals now cover nearly 34 million people, or 60% of the English population – up from 41% since the major levelling up plan two years ago, as the Government delivers on its plan to level up the country putting power back into the hands of local communities.
Transport Secretary Mark Harper said:
“Today’s almost £1.2 billion investment is truly game-changing for the smaller cities, towns, and rural communities across the West Midlands, and is only possible because this Government has a plan to improve local transport and is willing to take tough decisions like cancelling the second phase of HS2.
“This new funding boost will make a real difference to millions of people living across the West Midlands, empowering local authorities to drive economic growth, transform communities, and improve the daily transport connections that people rely on for years to come.”
The Local Transport Fund is directed to the North and Midlands because the majority of HS2 savings are from those regions. The new fund is also specifically for communities in the North and Midlands outside City Regions – who already receive City Region Sustainable Transport Settlements (CRSTS) – allowing them to deliver similar transport infrastructure upgrades in their local communities.
The West Midlands Combined Authority benefits from £1 billion of City Region Sustainable Transport Settlements (CRSTS) from 2022-2027, and has been allocated £2.6bn in the second round of CRSTS from 2027-2032 to improve transport across the region, funded in part from reallocated HS2 funding.
This investment demonstrates our commitment to reinvest all of the £19.8 billion from the Northern leg of HS2 in the North and all of the £9.6 billion from the Midlands leg in the Midlands, while the £6.5 billion saved through the new approach at Euston will be spread across every other region in the country.
Maria Machancoses, Chief Executive of Midlands Connect, said:
“This funding represents a significant investment in our region’s infrastructure. The Midlands contributes more than £90bn to the UK economy, and to boost that even more, we need reliable transport networks and investment in new technology.
“We welcome this announcement and the improvements it will bring for our communities and businesses across the Midlands, and we will continue to work with Government and support our local authorities, to ensure these vital Network North transport upgrades are delivered.”
The Government’s plan to transform British transport is already delivering for people. Today’s announcement follows £910 million to resurface hundreds of miles of local roads across the West Midlands with the first tranche of funding already being delivered, right from this financial year.
The Midlands is benefiting from £9.6 billion directly from reallocated HS2 funding which will boost local connectivity across the West Midlands. Projects include £1.75 billion to deliver the Midlands Rail Hub, over £1 billion more for the West Midlands Mayoral budget and strategic road improvements including fixing two major pinch points on the A5 between Hinckley and Tamworth.
We’ve also invested over £200 million to extend the £2 bus fare cap in England outside London until the end of 2024 and will spend £1 billion to improve bus services in the North and the Midlands, with £150 million delivered from April this year. Since the £2 bus fare cap was introduced across England on 1 January 2023, millions of passengers have benefited from lower fares.
£100 million will also be shared across the North and Midlands to support the development and rollout of contactless and smart ticketing, supporting seamless travel by enabling contactless or smartcard payment.
Taken together, these investments are all part of the government’s plan to build a brighter future for generations to come by levelling up transport infrastructure across the country.