HS2 given £100bn go ahead by Prime Minister

Boris Johnson

Prime Minister Boris Johnson has today given the go ahead for the £100bn flagship rail project HS2 in a speech at the House of Commons.

The first phase of the route will travel between London Euston and Birmingham, with a second phase going to Manchester and Leeds. A full-time minister will be appointed to oversee the project.

Johnson said: “There is no doubt of the clinching case for HS2. I cannot say that HS2 limited has distinguished itself in the handling of local communities. The cost forecasts have exploded, but poor management to date has not detracted from the fundamental value of the project.

“We will, in line with the review, investigate the current costs to identify where savings can be made in phase one without a total redesign.”

The cost of the HS2 project which was set out in the 2015 Budget was around £56bn, but the Oakervee review has said it could potentially cost more than £100bn.

Labour leader Jeremy Corbyn has accused the Conservative Party of copying Labour policies regarding HS2.

Corbyn said: “This is a government that is unwilling to make the scale of investment needed to revive the parts of our country that have been decimated by successive Conservative governments. And it’s a government that has proved unable to manage infrastructure projects properly and incapable to keep a lid on costs.”

He continued: “HS2 must be developed with more sensitivity to local communities and the environment, particularly regarding the impact it will have on woodlands. And if it is to have public support the fares on HS2 must be affordable. Can the prime minister tell us where the trains will be built? Will those jobs and training be in this country?

“What about other parts of the country, like the far South West for example? When will the Prime Minister match the £2.5bn commitment to upgrade the Great Western Mainline on our only train line into the South West? We believe the case is now unanswerable that our railways should be publicly owned and run to improve the service and cut fares by 33%.”

CBI on HS2: Time for debate is over and time for delivery is now

Responding to news that the government has given the go ahead to HS2, Matthew Fell, CBI Chief UK Policy Director, said: “The Prime Minister’s decision to back HS2 is exactly the sort of bold, decisive action required to inject confidence in the economy. It sends the right signal around the world that the UK is open for business.

“HS2 shows the government’s commitment to levelling up the nations and regions of the UK. The project will bring jobs, new homes, skills and investment to the areas of the country that need them most.

“Once built, HS2 will bring much-needed capacity to our railways and help to realise the government’s promise of an ‘infrastructure revolution’ for the North, Midlands and beyond.

“The time for debate over HS2 is over and the time for delivery is now.”

IoD responds to HS2 announcement

Responding to the Government’s announcement on HS2 and other transport infrastructure projects, Jonathan Geldart, Director General of the Institute of Directors, said: “The HS2 saga has not been a good advert for the UK’s ability to build major infrastructure, but now the decision has been made, many businesses in the Midlands and North will just want to see the Government get on and build it.

“Splitting the project into more manageable chunks makes political sense, but it also has a degree of business-sense, provided the right controls are in place. We encourage the Government to put strong governance frameworks in place to ensure management is properly scrutinised.

“Improving the rest of the transport network in the North, and making sure HS2 connects up, is just as important. Businesses leaders will be holding the Government to their promises on Northern Powerhouse rail and local transport.”

Reaction from the North

Comment from Mark Dexter, CEO of Knutsford-based, KDR Recruitment, on today’s decision on HS2: “The announcement today that the Government will go ahead with plans for HS2, including the links to Manchester and Leeds, is fantastic news for businesses and the economy in the North.

“The crucial benefit of HS2 is the extra capacity that it adds. Shorter journey times is of secondary importance but being able to add extra trains will make a huge difference to people travelling on an overcrowded and unreliable service.

“What needs to happen now is that HS2 needs to be properly joined up with the existing rail network and other proposed developments and it needs to be completed in the most cost effective and efficient way possible. The North has waited decades for investment in the transport infrastructure and we need to see real change as soon as possible.”

Business reaction

Dr Jonathan Owens, logistics expert from the University of Salford Business School, explores the announcement today that Government will continue to back the HS2 rail project. It could secure the future of British Steel at Scunthorpe.

Dr Owens said: “HS2 needs about 170 tonnes of long product rail and switch, which can be made in British Steel Scunthorpe. Therefore, it would make sense for this to be the plant to be the main supplier for the project. Buying raw material from overseas is a waste of time, money and effort, as well as increasing the supply chain cost by up to 30%.

“Currently Jingye is stalling on the deal the negotiated in November last year. However, now that HS2 is confirmed perhaps the deal looks more appealing. HS2 is a huge investment for the UK and keeping the investment within the UK’s supply chain as much as possible is important.

“HS2 is a challenging project in several ways, and it would be useful to understand and learn from phase one how these problems can be overcome, for example purchasing of property/land and routing of the controlling cables through cities etc.

“Understanding how well it operates in the more densely populated south, and does it cut travelling time as much as promised, could provide benchmarks for phase two.

“If lessons can be learnt, adapted and improved from the first phase, then it may be worth waiting until 2035-2040 for the completion of the Manchester and Leeds connections.

“The delay for HS2 coming North to Manchester and Leeds should be an opportunity to improve and develop and improve current infrastructure by focusing on the country’s East-West rail journeys for example, increasing throughput and reducing overcrowding. The HS2 project coming to these Northern regions earlier could be a distraction on the urgent need to focus on an inadequate infrastructure.”

And travel expert, Dr Neil Robinson, said: “The Government’s support for improved rail infrastructure in England is surely a good thing, yes it’s a lot of cash but it’s often the case that developments like this are colossal in terms of funding requirements.

“Many critics have argued that the costs could be better spent on other development and improvements throughout the UK, the only problem here is that spending needs to be planned for, you can’t just say we are going to spend x amount of cash tomorrow on the following ideas, they need a blue print and a fully costed plan, HS2 has the plans in place and the diggers are at the ready.

“So, what will the future look like, well one would hope that MCR to London times are much quicker, access from London to Birmingham and wider North West of England is improved and extra capacity is made available on the train, not to mention the economic injection to the regional and national economy.”