Spending Review 2025

Today’s Spending Review 2025 contained key budget information for local transport including active travel.

The announcement included:

• £15.6 billion for local transport in England’s city regions from 2027/28 to 2031/32 and
• £2.3 billion for local transport in England’s non-city regions from 2026/27 to 2029/30

Transport for City Regions

The city regions are East Midlands, Greater Manchester, Liverpool City Region, North East, South Yorkshire, Tees Valley, West of England, West Midlands and West Yorkshire.

The TCR fund is for integrated transport networks, infrastructure for new homes, and promoting modal shift from cars to public transport, walking and cycling.

Local Transport Grant for Non-City Regions

There’s quite a long list of English non-city regions. It includes, for example, Cambridgeshire & Peterborough Combined Authority, Hull & East Yorkshire Combined Authority, and York & North Yorkshire Combined Authority (YNYCA).

These authorities get the Local Transport Grant. £2.2bn of the £2.3bn Local Transport Grant is capital funding; the other £100 million is resource funding to help build capacity and capability.

YNYCA is to get £15.3 million in Local Transport Grant for 2025/26, then its total capital allocation from 26/27 to 29/30 is £94 million.

The government has outlined how the money should be spent:

‘Local leaders can choose to support schemes in line with local priorities for transport maintenance and enhancements, including improving public transport, funding new zero emission buses, improving accessibility, addressing congestion, and making our streets safer for pedestrians and cyclists.

Funding guidance will be issued later this year to support local areas decide how best to utilise their LTG allocations’.

Spending Review

Details of the Department for Transport’s budget are set out from p80 of the Spending Review.

Para 5.81 describes the Local Transport Grant as being for ‘local transport improvements including bus lanes, cycleways and congestion improvement measures’.

It says that London is to get £2bn of capital renewals funding between 2026/27 and 2029/30.

There is £24bn of capital funding for ‘motorways and local roads across the country’, with the aim of delivering faster, safer and more reliable journeys (para 5.82).

The £3 bus fare cap is extended until March 2027.

£616 million is the amount allocated ‘to build and maintain walking and cycling infrastructure’ from 2025/26 to 2029/30 (para 5.85). This is assumed to be Active Travel England’s ATF budget.

Adam Tranter says that this is not a transformative increase in funding. He says it amounts to £154 million a year – very much not the unprecedented amount promised by Louise Haigh in the early days of this government.

CWIS3

The third Cycling & Walking Investment Strategy, CWIS3, was due in March 2025 but was delayed until after the Spending Review.

The assumption is that it will be published fairly soon.