'Huge disruption for zero reward': Sadiq Khan leads backlash against HS2 delays after 'costs soar to £71bn'

9 March 2023, 14:13 | Updated: 10 March 2023, 00:47

Parts of the HS2 project are set to be delayed in a cost-cutting move
Parts of the HS2 project are set to be delayed in a cost-cutting move. Picture: Alamy/Getty

By Asher McShane

The Mayor of London Sadiq Khan has said the HS2 high speed rail project "must go ahead without further delay" after it was announced construction is set to be delayed by a further two years.

Labour's London mayor Sadiq Khan said having trains going to Old Oak Common for a longer period was not a viable option.

"Hundreds of millions of pounds have been spent regenerating the Euston area, and homes and businesses have been demolished to make way for HS2, causing huge disruption for zero reward," he said.

Mr Khan said the project "must go ahead without further delay".

Delays are set to primarily affect sections of the railway between Birmingham and Crewe, and Crewe and Manchester, with scheduled work postponed in a bid to curb soaring costs.

The high speed rail line may also not enter central London until the 2040s.

Mayor of London leads backlash against HS2 delays
Mayor of London leads backlash against HS2 delays. Picture: Getty

The decision will impact the final delivery of the high-speed railway, Transport Secretary Mark Harper said.

Mr Harper wrote: “The Government is committed to delivering HS2 Phase 2a between Birmingham and Crewe.

“We have seen significant inflationary pressure and increased project costs, and so we will rephase construction by two years, with an aim to deliver high-speed services to Crewe and the north west as soon as possible after accounting for the delay in construction.”

While accepting that construction projects are facing "extraordinary inflationary pressures" at the moment, Transport Select Committee Chairman Iain Stewart told LBC's Andrew Marr that is important to understand why costs are rising outside of inflation.

“If it’s a question of a two year delay or it not happening at all, I’d much rather there was a slight delay," he told LBC's Tonight with Andrew Marr.

Transport Select Committee Chairman Iain Stewart says there is going to be an inquiry into HS2.

The Mayor of the West Midlands Andy Street also expressed his "great disappointment" upon hearing the news and called for delays to be kept to a minimum.

As part of his statement, Mr Harper also announced setbacks to key road projects, citing soaring inflation and increasing costs.

However, shadow transport secretary Louise Haigh said the North is "yet again being asked to pay the price for staggering Conservative failure".

"Tens of thousands of jobs and billions in economic growth are dependent on this project," the Labour MP said.

"This is the biggest project in Europe and delays pile costs up in the long-run - ministers now need to come clean on precisely how much their indecision will cost taxpayers and the North."

But the target cost excluding the eastern leg of Phase 2b from the West Midlands to the East Midlands has ballooned to between £53 billion and £71 billion (in 2019 prices).

West Midlands Mayor Andy Street
West Midlands Mayor Andy Street. Picture: Alamy

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The HS2 project has been dogged by criticism over its finances. A budget of £55.7 billion for the whole of the project was set in 2015 during David Cameron's leadership.

The project's completion date has been pushed back from 2026 to a “window” of 2029 to 2033, with a possible further delay of four years.

The second part of the line to Manchester and a truncated eastern leg has been pushed back from 2033 to a window of 2035 and 2041.

Rail minister Huw Merriman told the Commons last week that the Government is "absolutely committed" to delivering HS2 but "cost pressures" must be examined.

Responding to the report that the project will be delayed, Prime Minister Rishi Sunak's official spokesman said: "You will know there's work already under way on HS2.

"Equally the rail minister has been clear we're continuing to look at any cost pressures and ensure the project delivers value for money for taxpayers."

Protests against HS2
Protests against HS2. Picture: Alamy

HS2 Ltd chief executive Mark Thurston recently said the project has suffered a "significant" impact from inflation adding to the cost of building materials, labour, fuel and energy.

"We're looking at the timing of the project, the phasing of the project, we're looking at where we can use our supply chain to secure a lot of those things that are costing us more through inflation," he told the BBC.

Conservative MP Simon Clarke, former chief secretary to the Treasury, described delaying the project as a "sensible decision".

He said: "Having observed HS2's progress as chief secretary, I have serious doubts as to value for money and cost control."

Michael Fabricant, also a Tory MP, said he will ask the Government whether the delay "marks the end of HS2 north of Birmingham" and if the "damage" done in southern Staffordshire - including to his Lichfield constituency - will be repaired.

He added: "Simply saying the project is delayed is not good enough.

Michael Fabricant, also a Tory MP, said he will ask the Government whether the delay "marks the end of HS2 north of Birmingham" and if the "damage" done in southern Staffordshire - including to his Lichfield constituency - will be repaired.
Michael Fabricant, also a Tory MP, said he will ask the Government whether the delay "marks the end of HS2 north of Birmingham" and if the "damage" done in southern Staffordshire - including to his Lichfield constituency - will be repaired. Picture: LBC / Alamy

"This project with the backing of Labour and the Lib Dems should never have gone ahead in the first place.

"Covid has encouraged remote working and even now regular rail commutes are down by 40% on pre-Covid levels.

"The Government are well aware this makes the business case for HS2 even less convincing than it was in the first place."

But the leader of Birmingham City Council, Ian Ward, said the reported decision to delay part of the route represents "another betrayal of the Midlands and the North, making a mockery of the Government's empty promises to level up the UK economy".

The Labour councillor said in a video message posted on Twitter: "HS2 has the potential to deliver economic growth across the country, but it is being undermined by the Government at every turn.

"We will only truly see the full benefits of HS2 when Birmingham and the Midlands are at the very heart of a national network.

"So another delay represents a massive blow to this once-in-a-generation opportunity to re-balance the UK economy."

Andy Bagnall, chief executive for rail industry lobby group Rail Partners, said: "While inflationary pressures make infrastructure projects more challenging, it is critical for Britain's economy and meeting net zero targets that large sections of HS2 are not delayed, which will ultimately increase the overall cost.

"We must address industry financial challenges across infrastructure and operations head on - not focusing solely on cost reduction, but also on driving revenues to close the financial gap and reduce the railway's reliance on taxpayer funding."

In October last year, Transport Secretary Mark Harper said the forecast for when HS2's phases would be complete remained within planned ranges.

That involved Phase One - connecting London with Birmingham - opening between 2029 and 2033.

Services will initially start and end at Old Oak Common, west London, due to delays at Euston.

Mr Harper said Phase 2a - extending the line from Birmingham to Crewe - was "on track" to be completed between 2030 and 2034.

The date range for the western leg of Phase 2b - connecting Crewe with Manchester - remained between 2035 and 2041, the Cabinet minister added.

No timetable has been set for when the eastern leg of that phase will open as it is at the early stage of development.

A planned extension to Leeds was shelved in November 2021.

The Department for Transport has been approached for comment.

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