18 May 2020

HS2 “badly off course”, says Public Accounts Committee

The House of Commons’ spending watchdog says the high-speed railway is delayed and over-budget.

Workers walk past a sign outside a construction site for a section of Britain's HS2 high-speed two railway project, at London Euston train station in London on January 20, 2020. - Britain's government on Monday said it would shortly decide on whether to proceed with its HS2 high-speed two railway project, whose cost is reportedly set to soar to more than £100 billion. HS2, which will quicken rail journeys between London in southeast England and cities to the north of the capital, has been dogged by controversy owing to projected spiralling costs and damage to wildlife. (Photo by Tolga AKMEN / AFP) (Photo by TOLGA AKMEN/AFP via Getty Images)

HS2, the planned high-speed railway linking London, Birmingham, Manchester and Leeds, is well behind schedule and over budget, according to the Public Accounts Committee (PAC).

In a damning report, the cross-party body has accused project bosses of having been “blindsided by contact with reality” and the government of having made a “wealth of mistakes” in its funding decisions.

The PAC highlighted a £46,000 bonus paid in 2019 to HS2 chief executive Mark Thurston on top of his pre-existing £605,350 annual salary as a particular cause for concern. The bonus was supposedly calculated, in part, on his success in controlling the scheme’s finances, but the PAC’s report claimed that HS2 was now set to cost in excess of £100bn, compared to the original £55.7bn outlined in 2015.

The PAC has accused the Department for Transport (DfT) of withholding key information about HS2’s spiralling costs and construction delays. The committee suggested that Bernadette Kelly, the DfT’s permanent secretary, may have broken the civil service code, following her “failure to explicitly inform the committee of the programme’s delays and overspend” when questioned about the project in parliament last year.

The PAC’s report will add fresh fuel to calls for the scheme to be scrapped entirely on the grounds that it does not represent good value for the taxpayer, especially within the context of the ongoing coronavirus pandemic. The surge in people working from home has also led to a huge decline in rail use. “The way we travel will change after Covid-19,” the former business secretary Andrea Leadsom told the Daily Telegraph, “and HS2’s economic and social benefits should now be reconsidered.”

But the DfT has issued a statement reiterating its commitment to project. While it acknowledged that a “new approach to parliamentary reporting” may be required, it pointed towards the appointment of a dedicated HS2 minister, Andrew Stephenson, in February, along with his duty to file six-monthly reports, as evidence that this was already underway.

The DfT statement added that Kelly had acknowledged cost pressures in May 2019, and that discussions between the government and HS2 bosses were “active” but “commercially confidential”.