The boss of HS2 today proposed a speeding up of the building of the northern, phase two, section of the £50 billion project.
HS2 Ltd chairman Sir David Higgins also called for a larger development at Euston – the project’s southern terminus. In a report entitled HS2 Plus, Sir David said reducing the contingencies which have pushed the total cost of the project up would be “irresponsible”.
But he said cost cuts might be possible later and he laid down the gauntlet to politicians by saying the speedier the HS2 legislation the better for cost reductions.
Sir David, the former London Olympics supremo, said HS2 was “vital for the future of the country”.
He added: “The cost and impact have to be recognised and acknowledged, but so too do the cost and impact of doing nothing.
“Without HS2, the people of this country will continue to face the failures of our transport system on a daily basis.
“This contingency has pushed the price of phase one – from London to Birmingham – up to £21.4 billion with £3 billion for the trains, while the cost of the second phase, taking the line in a Y-shape to north west and north east England is put at £21.2 billion with around £4.5 billion for the trains.
Phase one, which takes the line through Tory heartlands in the Chilterns to Birmingham, is set to be completed in 2026 while phase two is likely to be finished around 2032/33. The project is fiercely championed by some and bitterly opposed by others with shadow chancellor Ed Balls concerned about the cost and other former Labour grandees expressing reservations about the scheme.
In his report launched in Manchester today, Sir David, who helped mastermind the London Olympics plans, said the Government should “accelerate phase two as soon as possible”.
This would take the line 43 miles further north than planned, to a new transport hub at Crewe in Cheshire which could be completed by 2027, six years earlier than planned.
Sir David, who has joined HS2 Ltd after being chief executive of Network Rail, said “It is the right strategic answer, and not just for the area around Crewe: it would also deliver the benefits of HS2 – in terms of better services to the north – much sooner.”
But he added: “On the other hand, the current proposed HS1-HS2 link is, I believe, sub-optimal and should be reconsidered.”
Euston is the HS2 London terminus and there have been various changes to the original plans, with concerns expressed about the effect of the development on the area which includes the famous Camden market.
Sir David said today: “I propose the Government should look at a more comprehensive redevelopment of Euston – a solution that could truly stand the test of time and allow the station to join St Pancras and King’s Cross as an iconic driver of local regeneration whose beneficial effects will be felt for generations.”
Sir David also called for more work to be done on phase two to integrate HS2 into the existing rail network.
He went on: “HS2 should also be fully integrated into the plans that local authorities across the north are making to regenerate their particular economies and communities. It should form part of the effort to revitalise the northern economy as a whole.”
Sir David said that despite the potential benefits of HS2, he was “conscious of the price – financial, physical and emotional – that HS2 will demand from the country, from communities and from individuals”.
He went on “That is why I have rejected any thought that the project should cut back on planned mitigation measures, whether noise or environmental. Those will continue. It is also why I support the Government’s proposed approach to property compensation. We need to be clear about the impact of the project, as well as its benefits, and address the consequences of that impact, as we are.”
Sir David said he and his team had carried out “an exhaustive review of the costs”. He added: “Overall, I am satisfied that the £21.4 billion (including contingency) allocated to the phase one infrastructure project, plus the £3 billion (including contingency) allocated for phase one trains, is enough to deliver phase one.”
Legislation covering phase one is currently going through Parliament, Transport Secretary Patrick McLoughlin has said that the legislation will not be completed before the General Election.
Sir David said today: “The uncertainty over the legislative timetable plus the inherent risks associated with any project at this early stage is why I have resisted the temptation to reduce the large contingency contained in the budget. The same approach should be taken to the second phase when the work outlined above is complete.”
But he added: “None of that is to rule out the possibility that a target for a lower budget for phase one could be set at some point in the future, but only when the legislative timetable becomes clearer and more certain. There is a direct connection between the length of time the Parliamentary process takes, and the amount of contingency that is required.”
Sir David said: “HS2 is an enormous undertaking, but it is not an end in itself. If we do it right, it can be a catalyst for fundamental change at both a local and national level, up and down the country.
“It is ambitious because it needs to be, to meet the demands not just of the here and now, but of the future. That means being more ambitious about going further north, sooner. More ambitious too about producing a coherent transport plan for the north as a whole. And more ambitious about Euston to create a station that lasts. That is why I have called his report HS2 Plus.”
He concluded: “I firmly believe that HS2 is essential for the future of this country, and I recognise the political vision and courage on all sides that have been necessary to get us to this point. I applaud this and do not in any way take it for granted.
“HS2 will have to continue to earn that support. We have made a good start. Now we must build on it.”
Business Secretary Vince Cable said: “On every visit I make to the north of England, I’ve heard businesses and council leaders make a compelling case for getting to the north more quickly by accelerating parts of the HS2 build.
“That would ensure the economic benefits can be shared sooner by everyone around the country and deserves serious consideration by government.”
Mr Balls said yesterday that if the costs were shown to have decreased and come under control then Labour would back HS2 when it receives its second reading in the House of Commons in the coming weeks.
He added: “If this is not a value-for-money project, it shouldn’t be supported. I want to make sure the costs come down.”
The Institution of Civil Engineers welcomed the report as did the Department for Transport which said HS2 was “a vital part of our long-term economic plan”.
The department added: “Sir David has set us a challenge – HS2 can be better and delivered quicker.”
The CBI said the report “will help build confidence in the budget, delivery and benefits of HS2”
Shadow transport secretary Mary Creagh welcomed the report and the “strong focus on the steps the Government needs to take to get HS2 back on track and ensure value for money”.
Stressing that Labour supported the project, she added: “As always we will continue to hold the Government to account for keeping costs down on the project as the Bill progresses because there can be no blank cheque.
“David Higgins has made it clear that there are significant savings to be made if David Cameron gets a grip of this project and stops all these delays. The Government must now act so this scheme can be delivered under budget.”
Anti-HS2 organisation HS2 Action Alliance said bringing forward the phase two work would “not be as simple as it sounds” while the revamped Euston plan would merely “bring more work and wealth into London while compounding the problem of 100,000 commuters standing every day (while travelling) into London.”