01Introduction and policy context: transport matters for dynamic cities

Effective transport is vital for the economy. Transport matters for workers: there are almost 29 million commuters in Britain.1 One study estimated that even a 20 minute reduction in train journey time between Leeds and Manchester could increase average wages in both cities between 1 and 2.7 per cent.2 It is also important for business — over 40 per cent of businesses consider “transport links with other cities and internationally” to be an “absolutely essential” location factor.3

Transport affects all parts of the economy. Transport is not the answer to economic growth in our cities, but it is the underlying enabler of the factors that drive economic growth. If cities need more housing, then new roads, widening existing roads and expanding bus services will all be needed to bring those houses forward. The success of employment programmes to get people in to work is reliant, in part, on people’s ability to get to workplaces. Growing businesses need access to workers and other firms they trade with; and transport provides that link. In sum, transport brings everyone closer together, which saves time, money and helps businesses trade — all helping the economy grow.

Transport is not working in UK cities

The UK’s transportation systems are stifling rather than underpinning growth. The Organisation for Economic Co-operation and Development (OECD) noted that public infrastructure should be a priority for the UK, especially relieving road and airport congestion and challenges with the rail system. These factors, it claims, impede business and constrain productivity in the UK. In addition, the financial challenges of the recession have held back private investment for infrastructure projects.4

Traffic is increasing across the country, putting more pressure on the transport system. World Economic Forum ranks the UK 24th for the quality of our infrastructure and with the UK population set to reach 73 million by 2035, there is little evidence that current planning can meet future population needs.5 Car and taxi traffic in England is forecast to increase 12 per cent from 2010 to 2020.

Transport needs are also changing within and between UK cities. As cities grow and become more densely populated, there is a greater chance that commuters, residents and workers will shift from using cars to other modes of transport. But the right conditions have to be in place. Public transport has to be reliable, affordable and efficient. All too often it is not.

Cities face big challenges in making transport work for the economy

Despite most journeys being local, cities lack control over how they invest in and improve transport. Cities are at the mercy of Whitehall plans and funding to ensure quality bus services, potholes are filled in and new trams and trains are meeting the needs of growing places. Accordingly, there are five key challenges for making sure transport is doing its job – helping people get from A to B – and these need to be tackled by empowered and visionary cities (Box 1).

Box 1: Five key challenges for investing in better transport for cities

What is the challenge for providing transport in cities?

  • Coverage. Transport systems need to cover the area where people live, work, shop, visit the doctor and play sport. But linking up transport with all these factors over that area is challenging.
  • Coordination. Local transport is managed by too many players and funded through too many pots. This fractured approach leads to underinvestment.
  • Bus regulation. Buses are the most popular means of public transport, but unregulated bus companies do not always serve the public interest by linking in certain areas or offering an Oyster-style payment card, for example.
  • Long-term funding. Investing in transport is expensive and often financially risky. Because government is the major funder for projects, they can reduce the risks of investment, thus increasing investment, by funding local government on longer settlement terms.
  • Local funding for local projects. Cities should be able to pay for the transport projects that they need to grow. But UK cities cannot raise money so that local people pay for local transport. Councils need to be partners with Whitehall in funding transport, and they need more powers to contribute to the investment.

Report Outline

Section 2 of this report outlines the importance of efficient transport systems across city regions by demonstrating commuting patterns and explaining the benefits of transport investment. Section 3 discusses the five challenges for cities in achieving better transport in the context of the varying needs of places. Section 4 demonstrates why the position of Transport for London (TfL) supports an efficient and effective transport investment system alongside housing, jobs, the environment and so forth. Section 5 outlines the five key reforms and recommendations for Whitehall and cities and discusses new ways of working for local government to make the most of their transport systems.


  • 1 Adamsone L et al. (2013) Overview on the Smart Work Centres in Europe, Institute of National and Regional Economy, Riga: Riga Technical University
  • 2 Overman H et al. (2009), Strengthening Economic Linkages between Leeds and Manchester: Feasibility and Implications, Spatial Economics Research Centre, London: London School of Economics This was due to changes in the workforce composition – e.g. in terms of skills or industry type – that come with increased connectivity, rather than due to rising wages for the same workers
  • 3 McCarthy F. (2012), ‘European Cities Monitor’, Cushman & Wakefield, accessed 14 April, 2014, http://www.cushmanwakefield.co.uk/en-gb/research-and-insight/2012/european-cities-monitor-2011/
  • 4 OECD. (2009), OECD Economic Surveys: United Kingdom 2009, Paris: OECD
  • 5 Armitt J. (2013), ‘The Armitt Review’, September 2013, accessed 23 April, 2014, http://www.armittreview.org/