Government faces rising expenses for the London to Birmingham high-speed rail link
The estimated cost of the first phase of the HS2 high-speed rail project connecting London to Birmingham has risen by £9bn, bringing the total projected costs to £80bn in today’s prices, according to leaked reports.
Originally, the London-to-Birmingham route—running at 225mph between Euston Station and Curzon Street—was estimated to cost £44.6bn in 2019 prices. However, inflation, design changes and other factors have caused the latest figure to climb significantly.
Rishi Sunak previously cancelled HS2’s northern extension over concerns that the final bill might exceed £100bn. Despite this, the public accounts committee warned in February that ending parts of the project offered “poor value for money” for taxpayers.
The new report, highlighted by The Financial Times, suggests that the Euston-to-Curzon Street segment could now cost between £54bn and £66bn in 2019 prices, with inflation driving today’s estimated cost to approximately £80bn. The Department for Transport (DfT) has declined to confirm these estimates, instead maintaining that the incoming HS2 CEO Mark Wild will assess costs and deliverability.
October’s Transport Secretary, Louise Haigh, admitted that costs have spiralled out of control, adding: “The scale of failure in project delivery is dire.” Meanwhile, the Labour government has yet to determine the full financial scale of HS2 or how long the Old Oak Common to Euston section will take to complete.
Compounding the challenge, there are further costs required to upgrade Euston and Euston Square Tube stations to handle additional passenger demand. However, Transport for London (TfL) has no designated funding to support these works.
The continued uncertainty around costs, timelines and delivery timelines has sparked concerns. Lord Hendy, the rail minister, stated last week that the lack of clarity is “profoundly unsatisfactory.” He urged the government to take firm control of the first HS2 phase, emphasising that it was imperative to determine the true cost, timeline, and completion date.
With the Old Oak Common to Birmingham section expected to open by 2030, questions surrounding funding, costs and delivery timelines loom large over the entirety of the HS2 project.
