HS2’s critics seize on media reports of cost escalations

High Speed Rail

Opponents of HS2 have seized on reports that tender prices for the phase one construction have come in over budget and that HS2 Ltd has underestimated the cost of purchasing land for the line. 

New Civil Engineer reported that the target cost for contracts on the phase one route between London to West Midlands line were £1.2bn over the £6.6bn announced by the Government last summer. The Government awarded seven two-part design and build contracts last July for the phase one route (LTT 21 Jul 17). The first phase covered design, construction preparation and developing a target cost and the second stage, which should commence next year, is full construction.  

Joe Rukin, campaign manager at Stop HS2, said: “The important thing to remember here is it’s not the overall £55.6bn price of HS2 that’s due to go up by £1.2bn, it’s a small element, only about a tenth of the overall work which is jumping 18%  as £6.6bn becomes £7.8bn, and that’s before they have even started.”

Asked about the reports, HS2 Ltd said: “The main works civils contracts is designed as a two-stage process to ensure that HS2 is built in the most cost effective way to deliver maximum value for the taxpayer.

“Having carried out the biggest ground investigation exercise this country has ever seen, involving some 8,000 bore holes, we are now using the knowledge gained, along with the European expertise in each joint venture to complete the initial design phase. This process will drive out risk and increase cost certainties prior to starting construction. The programme remains on track and within budget.” 

The Sunday Times this weekend reported comments made by Doug Thornton, the former head of property at HS2 Ltd, that he had been put under “tremendous pressure to accede to an enormous deceit” in covering up that the Government company had under-estimated the cost of buying property along phase one of the route. 

The newspaper said: “One site officially valued by HS2 at £3,800 will end up costing taxpayers £40m – 10,000 times more. Initially assessed as agricultural land, Whittington Heath Golf Club, near Lichfield, must replace its Victorian clubhouse and five of its 18 holes.”

Thornton said the “scale of the land and property budget error is petrifying” with “a large proportion of properties... not budgeted for”. Thornton’s comments appear in documents passed to Lord Berkeley, a Labour peer, who has been highly critical of the HS2 costings (LTT 13 Apr).

On land and property, HS2 Ltd said this week: “We don’t recognise what has been reported. We are on budget with our professionally assured land and property programme, which is audited by the National Audit Office.”

Said Rukin: “Ever since HS2 was first announced in 2010, HS2 Ltd have been criticised for the fact that all route planning has come from map-based exercises using out of dates maps, without ever actually surveying routes before announcing them. 

“The most famous example of this was in 2016 when HS2 announced a change to the route in Yorkshire which took it through a new housing estate in Mexborough, which they did not know was there, because it wasn’t on the map they were using.”