HS2 could be delayed by more than five years, as Boris Johnson orders a review of the scheme to determine whether it should go ahead or be abandoned
The Department for Transport has announced an inquiry into the high-speed rail link, which will help “inform the government’s decisions on next steps for the project”.
In a written statement to MPs, transport secretary Grant Shapps, stated: “Colleagues will see that the chairman of HS2 does not believe that the current scheme design can be delivered within the budget of £55.7bn, set in 2015 prices.
“Instead, he estimates that the current scheme requires a total budget – including contingency – in the range of £72-78bn, again in 2015 prices.
“Regarding schedule, the chairman does not believe the current schedule of 2026 for initial services on Phase One is realistic.
“In line with lessons from other major transport infrastructure projects, his advice proposes a range of dates for the start of service. He recommends 2028 to 2031 for Phase One – with a staged opening, starting with initial services between London Old Oak Common and Birmingham Curzon Street, followed by services to and from London Euston later.
“He expects Phase 2b, the full high-speed line to Manchester and Leeds, to open between 2035 and 2040.
“He has also suggested that Phase 2a, West Midlands to Crewe, could be delivered to the same timetable as Phase 1, subject to Parliamentary approval.”
He added: “Furthermore, the costs and benefits of HS2 have been quoted in 2015 prices since the last Spending Review. While this allows a stable set of numbers to compare against, it also risks being misconstrued and understating the relative cost of the project, and indeed its benefits.
“I therefore think it is worth also updating the House in current prices. Adjusting by construction cost inflation, the range set out in Allan Cook’s report is equivalent to £81-88bn in 2019 prices, against a budget equivalent to £62.4bn.
“To be clear, these additions do not represent an increase in the project’s underlying costs, and are largely a point of presentation.
“Nonetheless, I will discuss with the Chancellor the case for updating the costs and benefits of HS2 to current prices to ensure transparency. Again, this is another reason for an independent review.”
Commenting on the announcement, Sir John Peace, chair of Midlands Connect and Midlands Engine, said: “HS2 is the best way to add the extra rail capacity we so desperately need to rebalance our country’s economy. It’s encouraging that the government has confirmed that construction work will continue while the review is ongoing.
“Although any delay is very disappointing, this is a project we will all benefit from for the next hundred years and more. It’s well worth waiting for.
“Now that we have an up-to-date account of how much HS2 will cost, we must also take a closer look at the benefits, which I don’t believe have been fully quantified or appreciated.”