HS2 cost soars to £66.6bn, company boss admits

Sign up for the View from Westminster electronic mail for professional evaluation straight to your inbox

Get our free View from Westminster electronic mail

Building HS2 between London and Birmingham alone will cost as a lot as £66.6bn, nearly twice as a lot as the unique estimate for all the undertaking.

The chief government of HS2 Ltd mentioned the cost has soared from an preliminary estimate below Gordon Brown’s authorities that it will cost simply £37.5bn (in 2009 costs).

That was below authentic plans for the undertaking, which included connections to Leeds and Manchester which have since been scrapped.

And on Wednesday, Sir Jon mentioned the estimated cost for Phase 1, from London to Birmingham, is between £49bn and £56.6bn at 2019 costs.

And adjusting the vary for present costs includes “adding somewhere between eight and £10bn pounds”, he instructed a committee of MPs.

Sir Jon mentioned causes for the cost improve embody authentic budgets being too low, modifications to scope, poor supply and inflation.

He went on: “It is the Government’s long-standing policy that infrastructure estimates are only updated at Spending Review points, that’s my understanding of it.

“So that’s why we’re nonetheless working to 2019 costs and the entire dialog about 2019, which is to be frank with you an administrative burden of some significance within the organisation.”

It comes four months after The Independent first revealed talks between Rishi Sunak and Jeremy Hunt to scrap the second phase of the high speed rail project.

The PM later confirmed the phase, connecting Birmingham to Manchester, would be scrapped, prompting outrage from northern business chiefs and political leaders.

Mr Sunak promised the government would re-invest £36bn from the high-speed rail project in a series of road and rail schemes across the country.

Sir Jon instructed MPs there are 4 the explanation why the cost of HS2 is greater than the preliminary estimate.

“The cost estimate in the first place, and the budget that was set in the first place were too low in my opinion,” he mentioned.

He went on: “There have been some changes to the scope… there definitely has been some poor delivery on our point… and fourthly, there’s inflation.”

Sir Jon added: “It’s worth remembering that between 2010 when prime minister Gordon Brown launched HS2 and 2019 when the current budget was set, the scope of HS2 has been changed significantly by a whole series of ministers.”