Future of £56bn HS2 rail link thrown into doubt

The future of the £56bn HS2 rail link has been thrown into doubt by Boris Johnson’s Government.

The Government has ordered a review into the scheme and the findings will include whether the project should go ahead.

Leaders in the North West including Andy Burnham and Steve Rotheram have long been backers of the scheme. However, critics have pointed to the ballooning costs of the link which would double the amount of rail services between London and the North.

The first phase to Birmingham is due to open in 2026 with Manchester and Leeds extensions planned for 2033.

There have been warnings in some quarters that the cost of the scheme could increase by as much as £30bn. The review, announced today, will look at how much the link will cost as well as deliverability and scope.

The findings will be presented to the Government in the autumn.

The review is being led by the former Crossrail Chairman Douglas Oakervee.

HS2 Phase Two

Transport Secretary Grant Shapps said: “The Prime Minister has been clear that transport infrastructure has the potential to drive economic growth, redistribute opportunity and support towns and cities across the UK, but that investments must be subject to continuous assessment of their costs and benefits.

“That is why we are undertaking this independent and rigorous review of HS2.

“Douglas Oakervee and his expert panel will consider all the evidence available, and provide the department with clear advice on the future of the project.”

The British Chambers of Commerce still want the scheme to go ahead. Director General Adam Marshall said: “There is a strong economic case for delivering all phases of HS2.

“For far too long businesses across the UK have had to cope with heavily congested Victorian-era railways – with passengers and freight traffic vying for priority.”

Gerald Jennings, Chairman of West & North Yorkshire Chamber of Commerce, said: “HS2’s importance goes beyond rail services: its anticipated arrival in this area is attracting investors and will rejuvenate local economies and create opportunities for business across the supply chain.

“That said, no projects – large or small – should have an open cheque book.  The Chamber wants to see proper checks and balances in place and then the review can act quickly to dispel any uncertainty about the scheme.”

CBI Director of Infrastructure Tom Thackray said: “The business message on HS2 is clear-cut – back it, build it, benefit from it. The debate has gone round the houses too many times.

“While it’s always helpful to review major projects like HS2 to ensure that value for money is delivered, the business case is well known.

“The approval of HS2 Phase One led to record levels of Foreign Direct Investment in the West Midlands, with more than 7,000 new jobs created in Birmingham as a direct result of HS2, and over 100,000 more. We have seen and are continuing to see similar benefits right across the proposed route.

“We firmly believe committing to HS2 in full, once and for all, will spread the flow of investment across the Midlands, the North of England and into Scotland.

“The current poor connectivity in the North is a major obstacle to encouraging companies from growing in the region and is a barrier to inward investment.”

Councillor Kim Groves, Chairman of the West Yorkshire Combined Authority Transport Committee, said: “I am deeply disappointed that the Government is putting a question mark against the future of HS2 in the context of an ongoing gulf in transport investment between the North and London.

“HS2 is fundamental to re-balancing the economy and addressing poor connections between cities in the North and Midlands which act as a significant brake on our economies.

“Given HS2’s potential to deliver 40,000 jobs directly, and a further 50,000 through productivity and regeneration benefits, to the Leeds City Region, we will be delivering a clear message that this project must be delivered in full.

“It is essential the review concludes quickly and removes the damaging uncertainty around this project, which is central to our plans for future growth which benefits all our communities.”

Roger Marsh, Chairman of the NP11 Board and the Leeds City Region Enterprise Partnership, said: “The additional capacity and faster journey times offered by HS2, integrated with Northern Powerhouse Rail and the existing network, are fundamental to the North’s ambitions to deliver extraordinary inclusive growth that will benefit all in society.

“This review is an opportunity to underline the importance of HS2 to rebalancing and strengthening the UK economy, and to work with Government to identify ways the project can deliver even more for the North of England.”

Iain Thomson, Head of Communications & IR at Harworth Group, which owns and manages a portfolio of 21,000 acres of land on around 120 sites throughout the North of England and the Midlands, also strongly backed HS2.

He said: “Whilst extra Government attention on directing the efficacy of HS2 is welcomed, it shouldn’t detract from the fact that extra rail capacity is urgently required in the UK to support growth and to take pressure off the road network.

“We hope the review focuses its efforts on the ‘how’ rather than the ‘whether’, as any kind of pause or cancellation would be a retrograde step.”

Andy Wood, Managing Partner, North & Midlands at business advisers Grant Thornton, said: “Businesses in the North and Midlands will be concerned that this landmark project – which truly promises to deliver the capacity and connectivity our economy needs – will hit the buffers.

“While there should be rigorous control of taxpayers’ money, HS2 is the most important infrastructure project in the UK.

“Core cities such as Glasgow, Leeds, Birmingham and Manchester require 21st century connectivity to London and we must continue to make the case for investment in this and other game-changing projects such as Northern Powerhouse Rail if we are to succeed in re-balancing the economy and thriving in the post-Brexit era.”

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