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HS2: Rising costs could push bill over £98bn, MPs warn

Graeme Paton, Transport Correspondent | Wednesday 22 September 2021, 12.01am, The Times

Original Article

The escalating cost of HS2 has “no clear end in sight” because of uncertainty over the route and key stations, according to MPs.

A cross-party report published today said there was still the “risk of cost increases” for the high-speed railway, which could push the budget beyond the £98 billion maximum estimate calculated by the government early last year. In 2015 the price was put at £55.7 billion.

Construction started on the first phase of the line between London and Birmingham 12 months ago but a “substantial amount” of the work is still to be finalised, the report said. Officials are also yet to fully quantify the final cost of delays linked to the pandemic, it was claimed.

The report by the Commons public accounts committee said MPs were “increasingly alarmed” by the lack of progress at Euston station in central London, where HS2’s main southern terminus will be built.

The redevelopment of the station is estimated to cost £2.6 billion, with 11 dedicated HS2 platforms being built to service the line.

However, the Department for Transport has spent the last 15 months attempting to bring down costs because of concerns that it could not be built on budget. This includes the potential for a smaller station with fewer platforms.

The report said it was “getting close to the point where the programme will literally run out of time if a decision is not made soon” on Euston.

This will mean that trains have to terminate at Old Oak Common – a huge new station being built five miles to the west of Euston – when the first phase of the line opens between 2029 and 2033.

The government must also make a critical decision over the 120-mile eastern leg of HS2 between Birmingham and Leeds, with Boris Johnson yet to confirm if it will be built in full. The decision is expected to be made next month.

MPs said cost increases had already “dented public confidence in the project. This has been exacerbated by the rising volume of complaints over disruption and environmental damage caused by the project, the report said.

Dame Meg Hillier, Labour chairwoman of the committee, said: “HS2 is already one of the single most-expensive taxpayer-funded programmes in the UK but there’s actually no clear end in sight in terms of the final cost, or even the final route.

“This project cannot simply keep sinking more taxpayer funds without greater clarity on the later phases.”

Sir Geoffrey Clifton-Brown, the committee’s Conservative deputy chairman, said tohe final bill “could well exceed” the £72 billion to £98 billion estimated range currently set out by the government.

The Y-shaped rail network – Europe’s biggest infrastructure project – will carry passengers at up to 225mph, halving journey times between big English cities.

Legislation for the second section – 2a – from Birmingham to Crewe recently finalised its passage through parliament and it is estimated to open between 2030 and 2034.

The third section – 2b – carries the line north to Manchester in one direction and to Leeds via the East Midlands and Sheffield in the other. A decision on the routes will be made as part of the forthcoming “integrated rail plan” being published by the Department for Transport, with the line set to be completed in full by 2040.

A spokeswoman for HS2 Ltd, the government owned company, said: “HS2 Phases One and 2a have received parliamentary approval and have very clear cost ranges. Although there have been challenges, particularly relating to the pandemic, the project remains on budget. HS2 is now supporting over 20,000 jobs and providing work for thousands of UK businesses, helping the economy to bounce-back after Covid.

“HS2 is moving forward, creating jobs and enhancing skills as we build a low carbon, high capacity railway that will change the way we travel in Britain.”

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