As we head into 2025, Britain's transport sector faces a complex landscape of ambitious reforms alongside significant operational and funding challenges. After a year of political transition and policy shifts, the industry must navigate substantial hurdles while attempting to deliver on new promises.
Getting Britain's Rail Network Back on Track
The railway sector stands at the threshold of major change, though questions remain about implementation. While the Passenger Railway Services (Public Ownership) Bill passed in late 2024 paves the way for nationalising three operators this year – South Western Railway, C2C, and Greater Anglia – the transition's complexity shouldn't be underestimated. Establishing Great British Railways under Laura Shoaf's leadership should give confidence to the sector, while Transport Secretary Heidi Alexander has positioned it as "second in size and importance only to the NHS."
Plans for passenger experience improvements include aligning the industry through publishing regular and prompt performance data at stations, upholding best price guarantees, and more trials of pay as you go. While implementing new systems presents natural challenges, these technological advances aim to enhance the customer journey.
The reality of infrastructure funding presents significant constraints. Chancellor Rachel Reeves has confirmed that new rail projects are unlikely until after the next general election, with resources concentrated on three existing projects: the London-Birmingham phase of HS2, TransPennine infrastructure upgrades, and East West Rail. While tunnelling funding from Old Oak Common to London Euston has been secured, broader infrastructure improvements appear dependent on private investment – a challenging prospect in the current economic climate.
Green Shoots for Sustainability Goals
Decarbonisation in the transport sector shows progress as we enter 2025. The car industry met its 2024 electric vehicle (EV) sales mandate, achieving the 22% target, though concerns remain over hybrid credits. The government's consultation on the Zero Emission Vehicle (ZEV) mandate offers hope for maintaining the 2030 phase-out of petrol and diesel cars, supported by improvements to charging infrastructure and manufacturer incentives.
However, critics argue that a direct switch to EVs may not achieve the needed emission reductions. Emphasising electrification risks overshadowing more sustainable transport modes like public transport, active travel, and micromobility, which could reduce emissions more effectively. Additionally, the focus on EVs may divert attention from the behaviour change necessary to reduce overall travel, particularly by private vehicles. Ultimately, a balanced approach that incorporates a wider range of sustainable transport solutions alongside EV adoption, will be crucial to achieving long-term decarbonisation goals.
The aviation sector, meanwhile, faces a particularly challenging sustainability journey. The Sustainable Aviation Fuel (SAF) mandate, which came into effect on the 1st January this year, sets ambitious targets of 10% SAF usage by 2030. However, industry experts are warning of likely compliance shortfalls, citing the need for billions in capital expenditure and dozens of new production facilities. The challenge extends beyond mere infrastructure – a significant skills gap in aviation decarbonisation technology, combined with higher fuel costs, suggests a bumpy road ahead for the industry's green transition.
The ongoing debate over airport expansion exemplifies the tension between economic growth and environmental concerns. Expansion proposals at Heathrow, Gatwick, Luton, Bristol and London City airports all face intensive scrutiny, with significant opposition from environmental groups and local communities Indeed, Mayor of London Sadiq Khan argues that approving a second runway at Gatwick would undermine the justification for a third runway at Heathrow, as both expansions would substantially increase aviation emissions, conflicting with the UK's net-zero climate targets.
This debate is also playing out within the UK Labour cabinet, highlighting an ideological split. Rachel Reeves supports expansion to foster growth, while Ed Miliband, a staunch environmentalist, opposes it. Keir Starmer, who voted against the third runway in 2016, contrasts with Reeves' position, reflecting the broader tension within Labour between prioritising economic growth and balancing it with environmental considerations.
Labour's Local Transport Agenda: Connectivity, Connectivity, Connectivity
Perhaps the most significant reform of 2025 will be the English Devolution Bill, which promises to reshape the landscape of transport governance in the UK. Following the publication of the white paper in December, the government has outlined plans to devolve more powers to regional and local governments, with a notable focus on transport. The white paper's provisions for transport are particularly promising, granting local authorities greater autonomy over transport initiatives and prioritising community-oriented projects, accessibility improvements, and sustainability. However, local authorities will need to balance this increased autonomy with reduced budgets, as funding and implementation remain major practical challenges. While the Bill is still in the drafting stages, the proposed shift in transport governance marks a significant step towards devolution, and its introduction in 2025 will likely be a defining moment in how power is distributed across England.
The Bus Services Bill promises greater local control over bus services, but questions remain about funding mechanisms and implementation timelines. If these can be answered, however, there are some real opportunities for positive change – notably, the introduction of compulsory training to enable drivers to identify and respond to threats of violence against women and girls, as well as antisocial behaviour on buses and at bus stops, making the network safer for all.
As part of broader reforms, plans to franchise bus systems are being rolled out across the UK. This has already been implemented in Manchester through the Bee Network, where the franchise model aims to provide more consistent, coordinated services. The West Yorkshire Combined Authority and South Yorkshire Mayoral Combined Authority are also considering similar measures. These changes aim to improve service reliability and passenger experience, though the success of such initiatives will depend on effective funding and integration with other transport modes such as rail. This is especially important to get right in rural areas where service frequency and reliability continue to be significant issues.
Complementing local transport reforms, the government launched a call for ideas to inform the development of the first Integrated National Transport Strategy, which aims to create a unified national vision that prioritises customer experience, connectivity and local community needs. With the call for ideas closing on February 20th, the coming weeks represent a crucial engagement opportunity for the transport sector.
Looking Ahead
This is set to be a year where ambitious plans meet practical constraints. Several key developments bear watching:
- The first wave of rail nationalisation will test the government's ability to manage the transition while maintaining service levels
- SAF implementation will reveal whether aviation can realistically meet its sustainability targets
- Local transport authorities will need to demonstrate they can deliver improved services with limited resources
- Infrastructure projects will face ongoing funding pressures, potentially leading to scaled-back ambitions
Success will require careful management of expectations and resources. While the transport sector's reform agenda is ambitious, the reality of implementation challenges, funding constraints, and competing priorities suggests a more measured pace of change than some might hope.
