The Shadow SRA was established in 1999 following the election of the Labour government in 1997 in an attempt to increase public interest regulation of the fragmented railway network following the privatisation of British Rail.

The government wanted the SRA to take a more interventionist role with Railtrack and its successor Network Rail, but never gave it the legal powers to do so.

Those powers rested with - and were jealously guarded by - the Rail Regulator, who frequently clashed with the SRA when he believed that it was over-reaching its jurisdiction.

On 15 July 2004 the Secretary of State for Transport, Alistair Darling MP, announced that the SRA was to be abolished within the next 12–18 months.

The Scottish Executive, the Welsh Assembly Government and the Greater London Authority were given some input in their areas.