PolicyLens

Green - Transport

Spend GBP 2.5bn on active travel

Invest around GBP 2.5bn annually in walking and cycling infrastructure.

Last updated: May 2026.

Read the policy-specific methodology note

Policy baseline

Green transport commitments include GBP 2.5bn per year for active travel. Benefits depend on local design and modal shift.

  • Targets urban and local transport users.
  • Projects are local and variable.
  • Health and congestion gains are indirect.

Core trade-offs

The direct beneficiaries are cyclists, pedestrians and local air quality. The costs fall mainly on taxpayers and road-space users. The main economic question is poorly targeted schemes can underdeliver.

  • Cyclists, pedestrians and local air quality gain most directly.
  • Costs fall mainly on taxpayers and road-space users.
  • Key risk: poorly targeted schemes can underdeliver.

Fiscal impact by 2028-29

+GBP 1.5bn to +GBP 5.0bn. Central estimate: +GBP 2.5bn.

  • Positive numbers mean net fiscal cost; negative numbers mean Exchequer savings.
  • Main channel is the scored tax, spending or delivery change.
  • Offsets depend on tax receipts, behaviour and pass-through.
  • Range reflects uncertain implementation and economic response.
  • This is not an official costing.

Economic impact by 2028-29

  • Jobs: Higher public employment or procurement demand; shortages may shift workers from private firms.
  • Wages: Direct gains for funded staff or suppliers; taxes fund the transfer.
  • Prices: Public prices rarely rise directly; private prices may rise if labour is scarce.
  • GDP / productivity: Potentially positive if capacity improves; negative if bottlenecks or crowd-out dominate.

Assessment

This is a real trade-off, not a free gain. Cyclists, pedestrians and local air quality benefit, while taxpayers and road-space users bear most costs. Overall output depends on behaviour, capacity and pass-through.

Confidence: Medium-low. Higher on the policy target and fiscal channel; lower on behaviour, pass-through and economy-wide effects.

Main risks

  • Delivery bottlenecks: Staffing, procurement and capital constraints may stop extra money becoming better services.
  • Crowding out: A tight labour market can shift workers from private firms rather than add capacity.
  • Permanent baseline: Temporary programmes can become recurring spending commitments.

Safeguards

  • Publish unit-cost benchmarks before rollout.
  • Tie funding to measurable service capacity.
  • Use staged delivery with independent audits.

Academic evidence

Graham and Gibbons, Journal of Transport Economics and Policy, 2019

Transport agglomeration effects

Transport improvements can raise productivity through agglomeration, but benefits are location-specific.

Relevant to rail, bus and active-travel investment.

Quantifying Wider Economic Impacts of Agglomeration (2019)

UK government evidence

Green Party of England and Wales, 2024

Green manifesto

The manifesto defines the tax, spending, climate, housing and public-service proposals modelled here.

Used to define the scenario, not as an official costing.

Manifesto for a Fairer, Greener Country (2024)

Department for Transport, 2025

Transport statistics

DfT statistics track travel demand, mode share and transport investment baselines.

Useful for scaling public-transport and active-travel policy.

Transport Statistics Great Britain (2025)

HM Treasury, 2025

Spending Review baseline

Transport capital and resource baselines affect additional-cost estimates.

Used to anchor fiscal additions.

Spending Review 2025 (2025)

Sources

Other Green policies

PolicyLens estimates are illustrative and should not be treated as official costings.