The cancelled phase 2 of HS2 will cost £100m to process, according to the latest report by the National Audit Office (NAO)
The National Audit Office has released a report into HS2 and its most recent developments, saying that the previous government’s decision to cancel Phase 2 in October 2023 will cost £100m in reversal procedures.
It also stated that the reversal process, including processes such as filling in boreholes made in preparation for the work, will take until 2027 to complete.
The report finds the Department for Transport and HS2 Ltd acted accordingly
The purpose of the report was to determine whether the Department for Transport (DfT) and HS2 Ltd are responding appropriately and adequately to the shift in the HS2 programme, especially in terms of money/cost management.
The report indicates that both HS2 Ltd and DfT quickly identified which parts of Phase 1 required reassessment to prevent unnecessary costs.
This includes the resetting of Euston Station to reflect the new size, and determining that other areas are best left as they are in terms of cost, such as the Birmingham Curzon Street Station being left with seven platforms, in spite of only needing three, to save money on replanning/resetting.
Disagreement on HS2 phase 1 costs
Where there is less coherency between HS2 Ltd and DfT is in the new estimated costs for Phase 1.
DfT estimates costs of Phase 1 at £45-54bn, whereas HS2 Ltd estimates £49-57bn. The reason for this is a disagreement on the method used to estimate, and so they feel an external advisor will be the best route.
HS2 Ltd has had a recent change in staff, and has also identified other pressures they feel may raise costs further, since making that estimate.
The report generally recommends that HS2 Ltd, DfT, and HM Treasury needs to focus their efforts on improving cost effectiveness, so that the cancelled phase of HS2 costs as little as possible.
