HS2 bill shoots up by billions as Birmingham leg costs four times more than said
The cost of building HS2 between London and Birmingham has shot up by another £10billion - meaning it's nearly four times more expensive than the Tories first said.
The bill for the section of high speed line may have soared to an estimated £66.6billion, the boss at HS2 Ltd said. This is nearly £30billion more than the Government said the entire line - which was also set to link with Manchester and Leeds before Mr Sunak torpedoed it in October - would cost in 2013.
When the project was first put forward, the London-to-Birmingham section was expected to cost £17.6billion. Sir Jon Thompson told the Transport Select Committee that adjusting for current prices involves "adding somewhere between £8billion and £10billion" to latest estimates - which are between £49billion and £56.6billion.
Labour Shadow Transport Secretary Louise Haigh said: “This is a direct result of Rishi Sunak's weak leadership and mismanagement of HS2. As Chief Secretary, Chancellor and now PM Rishi Sunak has allowed costs to soar and public money go down the drain.
“This is a government with no direction, no plan and no regard for taxpayers’ money." She added that Labour has introduced an independent review of transport infrastructure to learn lessons from the "shambles".
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Sir Jon said the original budgets were too low, adding that poor delivery, inflation and changes to the plans had caused the cost to rocket. And he warned that failings weren't exclusive to HS2.
He stated: "This is a systemic problem. It's not just about HS2, it's about large projects that the Government funds. The budget needs to be set early on in order for an outline business case to be approved by the Government, sometimes by Parliament. At that point, people think OK the original estimate for Phase 1 was £30 billion-something.
"That is based on very, very immature data. You don't have a design, you haven't procured anything, there is no detail on which you can cost anything."
He went on to say that basing cost estimates on guesswork can lead to huge inaccuracies, with the HS2 budget set too early. Sir Jon said: "If you say to a builder, can you give me a quote for an extension, they walk around and say 'it's £50,000-something'. But then you get into the detailed design, you know exactly how big it is, what surfaces you want, how much concrete needs to be poured. Unsurprisingly you get a better number.
"That's the situation here. The situation with HS2 in my opinion is the estimate was poor, the budget was set too early, and then when you get further into it, you get much better information."
He added that changes to the project - such as taking responsibility for Euston away from HS2 Ltd - will reduce the company's cost of building the railway.
Sir Jon said that the decision not to extend HS2 north of Birmingham could lead to a reduction in the number of seats for train services between London and Manchester compared with today. Initial plans for the project involved extending platforms at Crewe station and building a new station at Manchester Piccadilly to accommodate 400-metre HS2 trains.
But following Mr Sunak's changes, HS2 trains running north of Birmingham are expected to be configured to about 250 metres to fit in the stations. Sir Jon said: "In that scenario, there are less seats on the route from London to Manchester. In other words, capacity could go down.
"The reason why I can't be absolutely definitive about that is because it may, of course, be that somebody's got a fantastic plan to resolve that, but I'm not aware of it. So, under the current scenario, unless you extend Piccadilly station ... my understanding is there would be a reduction in the number of seats from London to Manchester."
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