Cost of HS2 high-speed rail line set to rise by £1.7bn

The cost of the HS2 high-speed rail line is set to rise by another £1.7billion, Transport Secretary Grant Shapps has revealed. So far £17.4bn has been spent on the new network, which will link London, Birmingham, Manchester and the East Midlands.

In a written statement to Parliament, Mr Shapps said: ‘HS2 Ltd reports £1.7bn of potential future cost pressures currently arising across the programme. Even so, the line is expected to be completed within its allocated budget, as the budget already includes £9.9bn of ’emergency funding’ to help deal with ‘management of risks and uncertainties’ .

Planned cost increases include:

  • £800m for potential additional civil engineering costs for the main works resulting from additional design costs and slower than expected progress in some areas.
  • An additional £400m for the cost of refurbishing HS2 Euston station in London.
  • £200m extra for the cost of rebuilding infrastructure at Euston and Old Oak Common, another London station
  • A net £300bn increase in costs “on other parts of the programme”.

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HS2 has sufficient emergency funds to pay for this without requiring a budget increase. said Mr. Shapps. He said the expected cost of the first phase of HS2, with trains running between London and Birmingham, was £40.3bn, and so far £15.7bn has been spent.

Smaller amounts of money have so far been spent on phase 2a – between Birmingham and Crewe – and the western part of phase 2b, between Crewe and Manchester, as well as what the government calls HS2 East, which is due take place between Birmingham and the East Midlands. A total of £17.4 billion has been spent on HS2 as a whole.

Mr Shapps said work on the London-Birmingham line was set to intensify. He said: “On phase one, over the next six months we will continue to ramp up construction work.”

He also said an agreement for the construction of Birmingham city center HS2 station would soon be signed, saying: “The first stage of the two-stage design and build contract for Birmingham Curzon Street station will be completed. shortly subject to agreement on an affordable target price.”

A £2billion contract to build HS2 trains at Hitachi’s factory in County Durham and Alstom’s factory in Derby has been agreed, he said. “The state-of-the-art train fleet, capable of speeds of up to 225 miles per hour, will be designed and built by a Hitachi/Alstom joint venture based in the North East and Midlands.” The contract also includes routine vehicle maintenance.

And he said the government was set to publish a plan to ensure HS2 benefits local economies. Mr Shapps said: “This year the government will release an HS2 Local Growth Action Plan, outlining how it will work with venues hosting Phase 1 and 2a stations to achieve their local growth ambitions. The new railway will spur growth around HS2 stations and beyond, helping to level the economies of the Midlands and North.”

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Jose P. Rogers