As Network Rail projects cut, HS2 Ltd report £190m splurge.

As what will surely make the pill of the cancellation of Trans-Pennine and Midland Mainline electrification projects more bitter to swallow, they have been announced on the same day that the annual accounts from HS2 Ltd reported a spend of £189.6m, two years before any construction is due to take place.

Transport Secretary Patrick McLoughlin announced that the Trans-Pennine and Midland Mainline electrification projects have been ‘paused’ due to all Network Rail upgrading projects going over-budget. His plan will now see the Great Western electrification project prioritised, claiming he had not made any cuts, as the total amount to be spent on rail upgrades would stay the same, even though it would be spent on fewer projects.

The announcement today vindicated the position of the Stop HS2 campaign, which has long said that other projects would have to be cut to pay for HS2. Using bad news to bury other bad news, what has gone relatively unnoticed has been the £189.6m annual spend reported by HS2 Ltd.

Spending from HS2 Ltd includes wages (excluding NI & pension contributions) of £44,477,000. With a total of 605 employees, this puts the average wage at HS2 Ltd a whopping £73,515. Other headline spending includes: £97,026,000 on ‘Professional Services’ provided by consultants, £10,765,000 on communications and IT and £9,250,000 on office accommodation. Whilst the total spend from is £40m under budget, HS2 Ltd themselves admit this is because the project is behind schedule, as work planned to happen on Phase 2 of the route has not happened because the announcement of the final route is currently due a year behind schedule. The original timetable for HS2 expected that the Phase 1 bill would have passed through Parliament by now, whilst this is not expected to happen for at least another year.

Stop HS2 Campaign Manager Joe Rukin responded:

“We have always said that the amount of money the colossal white elephant of HS2 needs would mean cuts to other rail upgrade projects, and we have been proved right. The reason for the cuts announced today is because all the rail projects are going over budget. In that respect HS2, which spent £190m last year two years before building is due to start, and has a £50bn cost still based on 2011 prices will be no different, and it will prove to be a price too high to bear.”

“If HS2 did not need so much money, these cancelled projects would be going ahead, but if HS2 carries on with escalating costs these projects will never happen. The golden child of HS2 was allowed to add £190m to national debt last year, without delivering anything tangible at all. It is quite simple, there is only so much money, and Government have to decide what is most important. At some point, common sense must prevail and HS2 must be stopped for the benefit of the many, not the privileged few.”

Penny Gaines, Chair of Stop HS2 said:

“These HS2 accounts have been slipped out at the same time as McLoughlin told Parliament about the delays to electrification and other railway programs.  HS2 Ltd are spending vast sums of money, but they haven’t got a plan for Euston, and they don’t know when Phase 2 will be announced, even though it is already nine months late.”

“The fluff from the HS2 Ltd’s chief executive about their wonderful engagement is in stark contrast to the reality of how HS2 Ltd treats people.  They have a Residents Commissioner appointed in January who hasn’t got round to talking to any residents yet.  On Tuesday, in a House of Commons debate, MPs were highly critical of HS2 Ltd’s engagement, even where the MP was in favour of HS2.  

“Looking at the details, the accounts talk about the UK’s future as a knowledge economy, but the development of HS2 has completely ignored the development of digital infrastructure which means businesses in future will have much less need for physical travel. The report talks about the importance of transport connections, but HS2 will have no connection to HS1. The report talks about sustainability, but HS2 will still have caused increased carbon emissions in 2086 and may never save carbon.

“There are problems with the existing railways, but planning an incredibly expensive new railway with limited stations is no way to solve the problems experienced by ordinary passengers on a daily basis. HS2 should be cancelled as soon as possible”

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4 comments on “As Network Rail projects cut, HS2 Ltd report £190m splurge.
  1. According to a leading article in a major national newspaper today, funds for HS2 are “ring-fenced”, whatever that implies, despite the continuing farce at Network Rail where projects needed NOW are “paused”,as opposed to HS2 which according to the Govt. won’t start until 2027, which I calculate to be 12 years’ away, however, encouragingly things keep slipping….

    • The real problem is a skills shortage: modifying an old line for electrification is difficult, more so if it is still running and it will take time to get the teams needed to strength and up to speed. It’s what happens when investment is stop/start with long pauses in between. Someone, somewhere should have realised this…

      • Lots of things in life are “difficult”. The Midland Mainline electrification is very important to add capacity, reliability and to reduce journey times. They should get on with it. What does it cost ? £ 1 billion or so – compared to £ 50 billion plus for HS2.

        Recent survey by the Leicester Mercury had 91 % of respondents saying that the Midland Mainline upgrade should be give priority over HS2. I suspect there are plenty of business people in Sheffield who would agree.

  2. This absurd saga continues. The Govt. continues to fund overspending on HS2, whilst postponing needed spending on current projects. McLoughlin refuses to release MPA reports, and DfT won’t/can’t give details on HS2 at 2015 prices. In Bucks. the members of The Select Committee were made very aware of the pain being inflicted on residents, but do they have any clout? If HS2 Ltd. was a plc. the directors would have all been sacked by now. Why are we having to put up with the continued arrogance, obfuscation and evasion practised by the Govt. & DfT/HS2 Ltd? Don’t say it’s because there is all-party support, that has never really been tested due to “whipping” combined with ignorance and some MPs either too lazy or indifferent to look at the details. In most countries further expansion of HS lines has been cutback or cancelled by the Govts. concerned. Here they just blunder on, blinkered.

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