{"id":2557,"date":"2024-01-15T22:20:33","date_gmt":"2024-01-15T12:20:33","guid":{"rendered":"https:\/\/www.vibewire.com.au\/?p=2557"},"modified":"2024-01-15T22:20:33","modified_gmt":"2024-01-15T12:20:33","slug":"hs2-boss-admits-project-could-cost-up-to-66-6-billion","status":"publish","type":"post","link":"https:\/\/www.vibewire.com.au\/?p=2557","title":{"rendered":"HS2 boss admits project could cost up to \u00a366.6 billion"},"content":{"rendered":"

The estimated cost of building HS2 between London and Birmingham has soared to as high as \u00a366.6 billion, MPs have been told.<\/strong><\/p>\n

Jacob King\/PA Wire<\/em><\/p>\n

HS2 Ltd executive chairman Sir Jon Thompson told the Transport Select Committee that the estimated cost for Phase 1 is between \u00a349 billion and \u00a356.6 billion at 2019 prices, but adjusting the range for current prices involves \u201cadding somewhere between eight and 10 billion pounds\u201d.<\/p>\n

In 2013, HS2 was estimated to cost \u00a337.5 billion (in 2009 prices) for the entire planned network, including now-scrapped extensions from Birmingham to Manchester and Leeds.<\/p>\n

Sir Jon said reasons for the cost increase include original budgets being too low, changes to scope, poor delivery and inflation.<\/p>\n

He said: \u201cThis is a systemic problem. It\u2019s not just about HS2, it\u2019s about large projects that the Government funds.<\/p>\n

\u201cThe budget needs to be set early on in order for an outline business case to be approved by the Government, sometimes by Parliament.<\/p>\n

\u201cAt that point, people think OK the original estimate for Phase 1 was \u00a330 billion-something.<\/p>\n

\u201cThat is based on very, very immature data. You don\u2019t have a design, you haven\u2019t procured anything, there is no detail on which you can cost anything.\u201d<\/p>\n

He added: \u201cIf you say to a builder, can you give me a quote for an extension, they walk around and say \u2018it\u2019s \u00a350,000-something\u2019.<\/p>\n

\u201cBut 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.<\/p>\n

\u201cThat\u2019s 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.<\/p>\n

\u201cThen on that basis, you can cost it out with more accuracy and then you discover it\u2019s higher.\u201d<\/p>\n

Following Prime Minister Rishi Sunak\u2019s decision in October 2023 to axe plans to extend HS2 beyond Birmingham, the Department for Transport (DfT) published a Network North document outlining future plans.<\/p>\n

The document stated that the cost of Phase 1 \u201cshould lie between \u00a345 billion and \u00a354 billion and has been clear that HS2 Ltd should deliver at the lower end of this range\u201d.<\/p>\n

Sir Jon told the committee that during the six months up to October last year HS2 Ltd held more than 50 meetings attended by DfT officials or their representatives to discuss the cost.<\/p>\n

He said: \u201cIt\u2019s for the department and the Government to decide what it wants to use that data for, but I do not believe that Phase 1 could be delivered for \u00a345 billion.\u201d<\/p>\n

Sir Jon said changes to the scope \u2013 such as taking responsibility for Euston away from HS2 Ltd \u2013 will reduce the company\u2019s cost of building the railway, but \u201cwhether it\u2019ll come down by anything like the number that was quoted in Network North, I doubt\u201d.<\/p>\n

On why official cost estimates are still being given at 2019 prices, Sir Jon said: \u201cIt is the Government\u2019s long-standing policy that infrastructure estimates are only updated at Spending Review points, that\u2019s my understanding of it.<\/p>\n

\u201cSo that\u2019s why we\u2019re still working to 2019 prices and the whole conversation about 2019, which is to be frank with you an administrative burden of some significance in the organisation.<\/p>\n

\u201cAll of the invoices we get we have to then deflate backwards to 2019 prices even though we\u2019re paying them at 2024 prices.<\/p>\n

\u201cAnd then we have to adjust the accounts to account for that, so it is a significant administrative faff to be frank.\u201d<\/p>\n

Sir Jon also told the committee that the decision not to extend HS2 north of Birmingham could lead to a reduction in seat capacity for train services between London and Manchester compared with today.<\/p>\n

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.<\/p>\n

Following Mr Sunak\u2019s changes, HS2 trains running north of Birmingham are expected to be configured to about 250 metres to fit in the stations.<\/p>\n

Sir Jon said: \u201cIn that scenario, there are less seats on the route from London to Manchester. In other words, capacity could go down.<\/p>\n

\u201cThe reason why I can\u2019t be absolutely definitive about that is because it may, of course, be that somebody\u2019s got a fantastic plan to resolve that, but I\u2019m not aware of it.<\/p>\n

\u201cSo, under the current scenario, unless you extend Piccadilly station \u2026 my understanding is there would be a reduction in the number of seats from London to Manchester.\u201d<\/p>","protected":false},"excerpt":{"rendered":"

The estimated cost of building HS2 between London and Birmingham has soared to as high as \u00a366.6 billion, MPs have been told. Jacob King\/PA Wire […]<\/p>\n","protected":false},"author":1,"featured_media":2558,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"om_disable_all_campaigns":false,"_monsterinsights_skip_tracking":false,"_monsterinsights_sitenote_active":false,"_monsterinsights_sitenote_note":"","_monsterinsights_sitenote_category":0,"_uf_show_specific_survey":0,"_uf_disable_surveys":false,"footnotes":""},"categories":[153,387,85],"tags":[],"class_list":["post-2557","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-british-railways","category-scotlands-railway","category-uk"],"aioseo_notices":[],"_links":{"self":[{"href":"https:\/\/www.vibewire.com.au\/index.php?rest_route=\/wp\/v2\/posts\/2557","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.vibewire.com.au\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.vibewire.com.au\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.vibewire.com.au\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.vibewire.com.au\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=2557"}],"version-history":[{"count":0,"href":"https:\/\/www.vibewire.com.au\/index.php?rest_route=\/wp\/v2\/posts\/2557\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.vibewire.com.au\/index.php?rest_route=\/wp\/v2\/media\/2558"}],"wp:attachment":[{"href":"https:\/\/www.vibewire.com.au\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=2557"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.vibewire.com.au\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=2557"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.vibewire.com.au\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=2557"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}