Cost of HS2 London to Birmingham line 'could soar to nearly £67 billion'

10 January 2024, 19:47 | Updated: 10 January 2024, 20:00

By Jasmine Moody

The boss of HS2 has now told MPs that the cost of the rail project, connecting London and Birmingham, could soar to as much as £66.6 billion.

HS2 Ltd executive chairman Sir Jon Thompson told the Transport Select committee that the estimated cost for Phase 1 is between £49 billion and £56 billion, but adjusting the current range of prices involves "adding somewhere between eight and 10 billion pounds".

In 2013, the project was estimated to cost £37.5 billion, including the now-scrapped extensions to Manchester and Leeds.

Sir Jon said the reasons for the staggering increase include the original budget being too low, changes to scope, poor delivery and inflation.

Calling it a "systematic problem" where budgets are set out early "based on very, very immature data."

He added: "It's not just about HS2, it's about large projects that the Government funds.

"The budget needs to be set early on in order for an outline business case to be approved by the Government, sometimes by Parliament."

Read more: Politicians should have the right to change direction, says Rishi Sunak as he defends decision to scrap HS2 north

Read more: Labour can't commit to reversing HS2 cancellation, Keir Starmer says, after Sunak takes 'wrecking ball' to finances

Explaining the cost he added:"You don't have a design, you haven't procured anything, there is no detail on which you can cost anything.

"But 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."

Rishi Sunak: The 'facts have changed' on HS2

In October 2023, Rishi Sunak decided to scrap the Northern leg of HS2 to Manchester during the Tory party conference.

This decision attracted vast criticism from regional leaders, who branded the scrappage as a “betrayal” for northern voters.

But he said that the line would run into central London as promised.

"Every region outside of London will receive the same or more government investment than they would have done under HS2, with quicker results," he said.

He said he would create a "Network North", explaining: "With our new Network North, you will be able to get from Manchester to the new station in Bradford in 30 minutes, Sheffield in 42 minutes, and to Hull in 84 minutes on a fully electrified line."

Mr Sunak said that HS2 trains will run to Euston in London but that the HS2 management will no longer run the project there.