Despite devoting over eight years to the planning of HS2 Euston, the Department for Transport (DfT) is uncertain about its objectives, according to a parliamentary committee
The DfT stated its decision to halt new construction activities at HS2 Euston for the following two years in March 2023. The Public Accounts Committee (PAC) highlighted many of the issues of the project in a recent report. The PAC urged the DfT to use this construction pause as an opportunity to establish the design and cost expectations for the station.
The DfT has been accused of lacking information on the costs and consequences of the construction pause for the local community. There is still work to be done in ensuring the safety of the site at HS2 Euston.
The PAC also expressed concern over DfT’s ability to mitigate the impact on its supply chain, especially for smaller businesses involved in the project. Arguably, this could be achieved by providing alternative employment opportunities within the HS2 scheme.
HS2 Euston has run significantly over budget
The DfT decided to pause construction as costs were predicted to reach £4.8bn, exceeding the original £2.6bn budget. Previous updates to Parliament did not mention the potential risks of construction costs fussing over at the Euston HS2 station.
There are lingering concerns about how the Government will handle significant inflation rates within the HS2 program. During the PAC’s inquiry, it was revealed that the project is experiencing cost fluctuations of 30% to 40% for raw materials.
The Treasury has stated that departments should accommodate the increased costs resulting from inflation using their existing budgets. However, the DfT and Treasury have not yet agreed on a solution that avoids compromising the project’s value for money, including potential reductions in spending.
Questions have been raised on how the Government will handle high inflation affecting the HS2 programme. An investigation by the PAC found that the cost of raw materials for the HS2 project has fluctuated between 30% to 40%.
The Treasury stated that departments should manage the increased costs caused by inflation using their existing budgets. However, DfT and the Treasury have not agreed on a solution that would not compromise the value for money of the project. This could result in further spending cuts.
Further delays added to the completion of HS2
HS2 has also been criticised for heavy delays to the project’s completion. Transport Secretary, Mark Harper, announced a recent spate of delays due to overspending. The delays aim to distribute costs over a longer timeframe.
Sections of the planned line between Birmingham, Crewe, and Manchester will be rephased and delayed by a further two years. The opening of the Crewe line is now projected for 2036, and Manchester’s line is expected to open in 2043.
“The HS2 Euston project is floundering. This is a multi-billion-pound scheme which has already caused major disruption to the local community put on pause. The pause, ostensibly to save money, is not cost-free – mothballing and possible compensation for businesses which have lost work will all need to be added to the HS2 tally,” said Dame Meg Hillier MP, chair of the committee.
“The Government must now be clear about what it is trying to achieve with this new station and how it will benefit the public,” she concluded.
You can read the full Public Accounts Committee report here.
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