The prime minister said the £2.15bn investment was a “downpayment for growth” in northern England and a “vote of confidence” in its “world-beating industries”.
Some £415m of the total will be used to improve rail services between Manchester, Huddersfield, Leeds and York.
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Number 10 also said local leaders would get more than £1bn to boost transport, while an additional £270m will be provided to bolster buses and £330m set aside for road maintenance.
The prime minister is due to visit a factory in the North on Friday to urge regions to speed up projects such as a mass transit system in West Yorkshire, a new rail station in Liverpool’s Baltic Triangle area, and the redevelopment of Bury Interchange.
“The North is home to a wealth of talent and ingenuity,” said Sir Keir.
“But for too long, it has been held to ransom by a Victorian-era transport system which has stifled its potential.”
He added: “I lived in Leeds for years, I get that this has real-world impacts – missed appointments, children late to school, work meetings rescheduled – all leading to insecurity and instability for working people.
“My government won’t stand by and watch. We are rolling up our sleeves, and today’s downpayment for growth is a vote of confidence in the North’s world-beating industries.”
The multibillion-pound TransPennine Route Upgrade will reduce journey times between Manchester and Leeds from 50 to 42 minutes, while people will save 10 minutes from Manchester to York.
Electrification of the line has been long-delayed.
Sir Keir said it was time industry in the region “had a government on their side to get the North motoring again”.
He said the government was spending “double as much on local transport in the North than the South”.
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Chancellor Rachel Reeves said reliable and affordable public transport links are “essential for kickstarting economic growth and putting more money in people’s pockets”.
She added: “The transport system outside of London and the South East has been plagued by delays and cancellations, frustrated by strikes and failing infrastructure because upgrades that were promised were never delivered.”
