Ending 'white elephant' HS2 could solve Treasury's £50bn debt problem at a stroke say MPs

[dutchman]

Senior Conservative backbenchers are calling for the cancellation of the rail project to help ‘stay the nation’s finances’



Scrapping the second phase of HS2 would go a long way to filling the £50 billion black hole in the public finances, a report has found, as senior backbenchers called for its cancellation.

Research seen by The Telegraph found that the £26 billion initial estimate for the second leg of the project from Birmingham to Manchester is likely to reach almost £40 billion by 2040.

Conservative MPs said Jeremy Hunt, the Chancellor of the Exchequer, should scrap the project instead of raising taxes and cutting spending in other areas.

The report was conducted by a group of engineering experts led by former mining engineer Trevor Parkin, in the Staffordshire town of Stone, near to where construction for the second phase will soon begin.

It argues that phase two of the project could be replaced with smaller rail upgrades, including the reopening of the North Staffordshire railway line to allow freight trains to travel cross-country.

The savings of scrapping the scheme were calculated by applying a conservative inflation estimate to its official costs, which have been published in 2019 prices.

Sir Bill Cash, the veteran Tory MP who represents Stone in the Commons, told The Telegraph: “Taxpayers all over the country are being deeply affected by the economic problems that we've experienced as a result of Covid and energy prices and inflation.

“This would help to stay the nation’s finances. We want to achieve a double whammy, which is to help the country and the national finances and also to help the people who are being disastrously affected by this white elephant project.”

Sir John Redwood, who served as the head of Margaret Thatcher’s Downing Street policy unit, said: “The business case for the huge investment in HS2 was always weak.

“It has been undermined by post-Covid travel demand, which is well down, affecting the argument for capacity. The Government should reappraise this spending.”

The report also calls on ministers to sell back the land it has already bought for phase two – as the vast majority of construction work has yet to take place – and that it could do so at a higher price.

Greg Smith, the MP for Buckingham and a member of the Commons transport select committee, said scrapping HS2 “could solve virtually all of the Treasury’s problems right now”.

“It’s a massive white elephant that no test of public opinion has ever found support for, that is going to cost us billions, if not hundreds of billions, of pounds in its entirety.”

[rebbonk]

HS2 was always a vanity project that a select few were going to profit from.

[dutchman]

HS2 under review as line faces delay and costs balloon



Ministers are to order a review into the entire HS2 project amid mounting pressure to rein in ballooning costs.

Insiders said the Department for Transport (DfT) was poised to commission HS2 Ltd, the government-owned company asked to deliver the line, to re-evaluate the scheme.

The assessment will examine axing proposed stretches of the line or delaying completion of the project.

Options to be considered include further delays to completion of phases as well as scrapping the 40-mile stretch of line from Birmingham to East Midlands Parkway, near Nottingham. It will also examine axing the section north of Crewe and instead running trains into Manchester on existing tracks. The opening of the section from Old Oak Common, west London, to Euston could also be delayed.

The government had already started two internal probes into the project. The Times has been told that these will be superseded by a root and branch review that HS2 Ltd will be formally told to carry out by the government.

The estimated cost of HS2 has increased from £32.7 billion when it was approved in 2012 to £72 billion.

Alan Over, director general of the DfT’s High Speed Rail Group, has been asked to oversee a massive internal review of the project before it is transferred to HS2 Ltd.

Officials at the DfT are working on Project Silverlight, an efficiency exercise designed to find savings in the first phase of the project, which links London and Birmingham. A second study, codenamed Operation Blue Diamond, is examining ways to cut costs across the entire project.

Rishi Sunak is said to be a vocal critic about the vast amount of money the rail industry has cost the taxpayer since the pandemic, complaining about empty trains “shipping fresh air” around the country. The prime minister is understood to be sceptical about the benefits of HS2 given its vast cost and pushed hard for it to be scaled back while chancellor, but had to contend with Boris Johnson, “who loves building things,” a source said.

Andrew Gilligan, the former Downing Street special adviser who worked on the project while Johnson was prime minister, said that all sections of HS2 where construction has not begun should be axed.

He added that HS2 was “Britain’s greatest infrastructure mistake in half a century” and that cancelling it would save £3 billion a year by 2027-28. He said the savings could rise to £7 billion in later years and reach £44 billion or more in total.

Gilligan said: “Rising costs and falling public spending means that if HS2 continues as planned, it will eat much of the rest of the public transport budget, causing terrible harm to the services that most people actually use, need and want, and which could do far more for economic growth, reducing CO2 and cutting road congestion.”

Please note original article is behind a paywall and cannot be accessed without a subscription.

[dutchman]

The facts have changed, says Rishi Sunak, as he scraps HS2 leg



"The facts have changed," the PM has said, as he confirmed the HS2 high-speed rail line from Birmingham to Manchester would be scrapped.

Addressing his party conference, Rishi Sunak said the project had come from a "false consensus" that links between big cities were "all that matters".

He announced he would instead invest in transport projects across the country.

The PM announced that the northern leg, between Birmingham and Manchester, as well as the eastern leg to East Midlands Parkway, would no longer go ahead.

He confirmed that the line from the West Midlands would run all the way to Euston station, not Old Oak Common in west London as had been rumoured.

This was accompanied by news that nearly £4bn would be reallocated to transport schemes in six northern city regions.

There will be £3bn for upgraded and electrified lines between Manchester and Sheffield, Sheffield and Leeds, Sheffield and Hull, and Hull to Leeds.

He also said money would go towards resurfacing roads across the country.

The decision has angered some including local leaders, such as Andy Street, the Conservative Mayor of the West Midlands, businesses in Manchester and former PM David Cameron.

Mr Cameron said it was the wrong decision, meaning a "once-in-a-generation opportunity was lost".

In a post on X, formerly Twitter, he said the reversal would "make it much harder to build consensus for any future long-term projects".

However, there has been growing concern about the ballooning cost of the project, which has already seen its section to Leeds cancelled.

There had been speculation the decision might drive Mr Street to resign, but he has told the BBC that while disappointed he would not be quitting either his job or the party.

Labour's shadow Cabinet Office minister Pat McFadden stopped short of committing the party to reviving HS2 between Birmingham and Manchester, saying it would need to "look at the numbers" if it won the next election.

He described Mr Sunak's announcement as a "Tory fiasco".

Labour also said most of the transport schemes listed by the prime minister had either been previously promised or planned, so these projects did not amount to new investment.

[rebbonk]

The bit that is left will be less than worthless.

The project ought never have been started. That's OUR money they've spaffed up the wall.

[dutchman]

The bit that is left will be less than worthless.

He should cancel that bit too!

[rebbonk]

Totally agree, Dutchman.

[dutchman]

HS2 will not extend to Euston without private funding



HS2 will not be extended to Euston unless enough private investment is secured, it has been reported.

While cancelling HS2 to Manchester this week, Rishi Sunak pledged to extend the high-speed railway to the central London station.

But PA Media, citing a No 10 source, reported the promise was contingent on a substantial proportion of the cost being met by private funds. If not enough money is found, HS2 will permanently stop at Old Oak Common in the capital’s western suburbs.

Extending HS2 to Euston involves digging a 4.5-mile tunnel from Old Oak Common and building a six-platform station next to the existing west coast mainline terminus.

At his speech to the Conservative party conference on Wednesday, the prime minister said: “We will complete the line from Birmingham to Euston.”

In the Network North prospectus released after the speech, the Department for Transport (DfT) said the Euston project would “take on the lessons of success stories such as Battersea power station and Nine Elms, which secured £9bn of private sector investment and thousands of homes [in London].”

It went on to say that to ensure “best possible value for the British taxpayer” the government would ensure that “funding is underpinned by contributions from those people and businesses its development supports”.

Government modelling shows two-thirds of people would prefer to travel to or from Euston.

HS2 work at Euston was paused in February because costs had ballooned to £4.8bn compared with an initial budget of £2.6bn.

The DfT said it would appoint a development company, separate from HS2 Ltd, to manage the delivery of the Euston project. Euston was initially due to have 11 platforms for high-speed trains but will now have six.

[dutchman]

I visited the exclusive Coventry street where HS2 shattered the peace



Beautiful sunlight cascades through the branches on this tree-lined Coventry. Mansions, often protected by tall gates and elaborate intercom systems, are situated on either side.

On the surface, life on Cryfield Grange Road, one of Coventry's most expensive streets, is bliss. The reality is anything but.

In the not-too-distant background, the near-constant thud of excavators drowns out that of heavy goods vehicles reversing. As well as being home to some of the city's plushest pads, Cryfield Grange Road is as close as Coventry residents get to the HS2 line. And construction is gathering pace.

Needless to say, those living on the Warwickshire side of CGR, whose back gardens are separated from the huge HS2 construction site in Coventry Road by just a couple of farmers' fields, are not best pleased about the highly controversial track.

Parts of the scheme were scrapped last week in a fresh twist in one of the most divisive and long-running infrastructure sagas of modern times. The din of machinery, on the other hand, is nothing new for the residents of Cryfield Grange Road where peace has been well and truly shattered.

"I don't like it and I don't want it," resident Ann Stathard tells me on my field trip to the outer reaches of Coventry. "It has ruined the trees. From my garden I can see it and you can hear it right the way through the day.

"I think what happened last week is proof it should never have gone ahead. My sister lives in Long Itchington (close to the HS2 site at Bascote) where they've dug under the wood. She dislikes it too and with all the roadworks it's hard to know where to go."

Makhan Dosanjh has lived further up CGR for more than 30 years. "It shocked me (when approval was granted)," he said. "I was always against it from day one. I talked to my son about selling before they started doing it at the back of the house about three or four years ago. It seems to be getting worse."

Mr Dosanjh fears the road will turn into a rat run when Kenilworth Road / Coventry Road closes to facilitate more building work. "It will drive a lot of traffic up here," he said. "It's only a tight street so the grass verges will get churned up as well.

"They keep digging up countryside and they keep building roads; for what? When it's dry and windy there's a lot of dust from the site. It gets blown in our direction.

"You can hear the construction at the back of the house, but not so much from the front. It's a waste of money. I don't know what the farmers who own the land next to the line are going to do when the trains start running.

Not everyone is seething about the construction site on their doorstep. From the elevated position of his beautiful barn conversion, Terry Dillon has arguably got the best (or worst) view of HS2 in progress of any Coventry inhabitant.

Like those who live closer to Kenilworth Road, Mr Dillon can hear every JCB clunk and HGV as it ferries stone from one place to the next. Yet he's almost grown oblivious to it, in the same way as people who live close to the London overground.

"It's no bother to us," he says. "You can't actually see the line because it's set down in the gulley they've dug out. I think all we'll hear (when trains are running) is a 'whoosh' as they go past."

That's not to say he's by any means a supporter of the train line, which will link London Euston with several stations in the West Midlands. "It's the removal of trees and the natural habitats that's the worst part," adds Mr Dillon, whose back garden is about 400 metres from the building site.

"I used to be involved with Warwickshire Wildlife Trust. Now I live next door to where thousands of trees have been cut down.

"It's just a waste of cash. I'd have preferred them to have updates the trains and tracks we've already got. If I wanted to go to London, I'd drive to Coventry Railway Station, leave my car there and get the train, which takes about an hour and a quarter.

"That won't change when HS2 is up and running so there's absolutely no benefits for me. Phase 2 being scrapped didn't surprise me. I spoke to a surveyor five years ago who said it would never happen because it would be far too costly."

[dutchman]

Cryfield Grange Road is as close as Coventry residents get to the HS2 line

I'm pretty sure that dubious honour belongs to the residents of Cromwell Lane which is both densely populated and actually crosses the proposed line!