The UK Government has announced revised costs and delivery timeframes for HS2, with the Transport Secretary outlining plans to reset the high-speed rail project following what ministers described as “years of mismanagement.”
Transport Secretary Heidi Alexander said the Government would aim to deliver the railway “as quickly as possible and at the lowest reasonable cost” while reducing complexity across the scheme.
A rendering of a HS2 train
© HS2 Ltd
In 2012, the original estimated cost of HS2 was between 32 billion GBP and 37.5 billion GBP for the full proposed network linking London, Birmingham, Manchester and Leeds. The scaled-back project is now expected to cost between 87.7 billion GBP and 102.7 billion GBP.
According to the Government, around two-thirds of the increase is linked to missing work from the original project scope, underestimation, and delivery issues. The remaining third is attributed to inflation.
Mark Wild, Chief Executive of HS2 Ltd, said:
I recognise this will be unwelcome news for local communities and taxpayers, and I share in their disappointment that it will take longer and cost more to bring HS2 into service.
Resetting HS2 was the only way to regain control of the project. We have turned a corner in the last 12 months with significantly improved levels of productivity, helping us to deliver major milestones ahead of schedule. We’re also progressing with plans to bring HS2 into line with other high-speed railways in Europe – further reducing the project’s complexity without compromising on benefits.
Better journeys, more capacity on the network, and economic growth are all vital to the country’s future prosperity, and that’s exactly what we will deliver. Driven by the hard work of 31,000 people on the ground, HS2 is finally getting back on track.
The Government has also confirmed that HS2 trains will operate at 320km/h (200mph), rather than the previously planned 360km/h (225mph). Ministers said the lower operating speed would align HS2 with high-speed rail services in Europe and Japan and could reduce costs by up to 2.5 billion GBP while shortening delivery time by at least a year.
Under the revised schedule, the first passenger services between Old Oak Common in west London and Birmingham Curzon Street are expected to begin between 2036 and 2039. The full route, including London Euston and a connection to the West Coast Main Line, is expected to be completed between 2040 and 2043.
The reset is being led by the senior team behind the Elizabeth Line project. Ministers note that six major construction milestones had been completed ahead of schedule during the past year, while around 300 back-office roles removed as part of efforts to reduce costs.
A new Government assessment also found that cancelling HS2 could cost a similar amount to completing the scheme, while removing the expected transport and economic benefits.
Transport Secretary, Heidi Alexander, said:
Taxpayers, passengers and communities along the route have been let down by years of mismanagement on HS2.
I share their anger about the waste and mess, but I am proud that this Government has worked with HS2’s new senior team to get this project off life support and on the road to recovery.
We will get the job done but we will also take every opportunity to save time and money in the process, getting a grip on delivery, controlling costs, and stripping out the complexity that’s plagued the project in the past.
We can and must build big infrastructure projects in Britain. But we also need competent people in charge of them. This is the same team that delivered the Elizabeth Line. We have done it before, we will do it again.
According to the Government, HS2 is forecast to contribute 20 billion GBP to the economy over the next decade around its station sites and depots. Development linked to Euston is estimated to contribute a further 41 billion GBP to the economy over the next 30 years.
To deliver the project, more than 6,100 contracts have been awarded to UK businesses, with over half going to small and medium-sized enterprises.
The HS2 reset will be funded through the Department for Transport’s existing Spending Review settlement, with future funding beyond 2029-30 to be considered at later spending reviews.