Mandarins at HS2 Ltd have estimated the actual final cost of HS2 will be £200 billion, it has been claimed. The official cost of the project, which started at £30bn in 2010 almost doubled to £56bn when it was last revised in 2015, though this figure does not include certain items such as the cost of the proposed new station near Crewe, and has not changed since the proposed route changes on Phase 2b were announced in 2016. In 2013, Treasury insiders put the overall cost at £73bn.
Last year, rail consultant Michael Byng, who produced new methods of estimating costs for Network Rail, applied those methodologies to the HS2 project and came up with an estimate just to build Phase 1 of HS2 of £53.6bn, almost as much as the Government estimate building the entire scheme and purchasing rolling stock will cost. This was dismissed by Government who claimed the official cost estimates had been ‘independently verified’, however it transpired this was done inside the DfT using the old discredited methodology.
Now, Luton North MP Kelvin Hopkins claims that HS2 are working to a figure of £200 billion, telling the Stop HS2 campaign:
“Leaks from inside the HS2 bureaucracy suggests the total cost of HS2 will be over £200 billion.”
It is absolutely clear that HS2 Ltd and the Government have not been truthful in the past about the costs of the project. In 2015, when costs were increased from £50.1bn to £55.6bn during the Autumn Statement, it was claimed that the costs had simply been risen to account for inflation, but an FOI request showed this not to be true as the cost of Phase 2 had actually gone up by 39.2%, with the overall costs kept down by reducing the estimate for rolling stock.
It is also the case that HS2 Ltd have regularly paid contractors significantly more than the value of their tenders. In 2014 it was revealed that a set of professional services contracts valued at £101m had come in 86% over-budget at £188m. The latest example of lack of budgetary control is the revelation that CH2M Hill, the firm current HS2 Ltd boss Roy Hill is on secondment from and his replacement Mark Thurrock is employed by, were paid £34m more than the value of their contract as Phase 1 development partner. When that contract was awarded in 2012, it was valued at £70m, but a written answer revealed the company has been paid £104, a 49% over-run on budget.
MPs are due to debate the final stage of the HS2 Phase 1 Bill on Monday (20th February), with Royal Assent expected later in the week.
Joe Rukin, Stop HS2 Campaign Manager responded:
“Over the years, we have seen the costs of HS2 spiral as they constantly make amendments to correct previous mistakes, and they exercise no budgetary control over contractors who seem to have been left to run their own kleptocracy. So to hear they are actually working to an estimate of £200bn seems about right, and is maybe the first truthful thing to ever come out of HS2 Ltd.”
“It has been clear since the outset that HS2 has got this far because the contractors who want to build it have lobbied hard for it, creating an illusionary imperative which has suckered politicians who are too lazy to do their own research and understand the case for this project is completely fictitious. Sadly it seems the only thing we can do now is watch the costs go up as the contractors build their gravy train, and we can look forward to saying ‘We told you so’ in twenty years when all those responsible for approving this disastrous white elephant are long gone.”
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According to the mortgage calculator, £200Bn over 60 years at 2% interest (AFAIK governments current borrowing rate – correct me if I’m wrong) costs £477,209,811 (that’s £0.5Bn) per month in repayments (or equivalent payment when debt becomes due)
Total repayments £343,591,064,265… £345Bn
Is this right????
Democracy across the population not across the 650 MPs.
This was the finding of the recent referendum across the UK for a possible incurred cost of £60Billion.
Surely £200 Billion debt build up cost requires a democratic referendum for HS2 not to rely on the MP wrong voting record to-date.
A corrective referendum for HS2 by the people to determine the uses of future debt burden is a fairer way ahead. This will be appreciated before Royal Assent happens against public opinion.
I now see in the times that hs2 are trying to tempt Google and high tec firms to invest in hs2 to help with the cost of building the project .They need to get these on board before driver less cars come in as they will take a lot of people of public transport .
This whole thing has been a farce ..
There are a lot of companies and individuals being overpaid by US i.e. THE TAXPAYERS…
but no MP will challenge this ??
The Governmant of this country are proving to be TOTALLY CORRUPT!
Write to Grayling asking him what the cost of HS2 is, my MP has tried but no reply, all a lot of waffle about the Govt. keeping a firm control on costs……
That’s the problem, they don’t know and are not prepared to set a ceiling other than saying it will be built within the £55.7bn. cost envelope. As has been said already, the 1st. stage has now been recosted at over £54bn., leaving just £3bn. for the rest…
Teresa May was definitely opposed to HS2, as was Corbyn… no wonder politics is held in such low esteem, they don’t believe what they say, MPs & Members of the House of Lords were whipped, never mind there is,maybe, 10% public support, so that’s OK.
Agreement to spend this kind of money, should HoC pass the bill on Monday, will surely be the biggest slap in the face to “we are all in it together” ( unless, of course “it” means deep doo doo) in recent history. Mrs May simply cannot allow this!
Would not be in the least bit surprised given the shambolic approach to the whole thing by HS2 Ltd and the Head in the sand government
Bless them
We want you to be explicit. The British people have not voted for HS2. The will of people should prevail. We accept right now there is no widespread appetite for HS. As the people did not vote and were without knowledge of HS2 in 2009 and 2010. As the project became clearer, there was no opportunity for MPs to change their minds about the HS2 scheme, whipping and possible self interest prevented that. Our mission is to persuade them to do so.
What was unfortunately only dim in our sight before the consultation in 2011 is now in plain sight. The route HS2is going down is not too expensive and does not provide any local and day commuting capabilities in the section between London and Birmingham and there are no stations. It is Extreme Speed long distance At Any Cost estimated at £200 Billion. Our challenge is to expose relentlessly what this cost vast is which prevents more worthy projects being delivered. We are now able to show how the MP’s decisions were based on imperfect knowledge which has now become informed knowledge but which the MP group think whipping cannot change. We can calculate in ‘easy to understand’ way how proceeding will cause real damage to our country and counties. We want to build support for finding a way out from the present rush over the cliff’s edge for HS2 a Brown, Balls, Hoon and Adonis conceived wasteful rail scheme. We don’t know if we can succeed to change from this HS2 to more useful rail improvements for more routine commuters. But we do know we will suffer a rancorous verdict from future generations if we do not try to change from HS2 now.
We argue for change precisely because we are citizens of our country – Britain – who believe that in the 21st Century, we should improve transport roads and rail but not by this HS2 which has a narrow commuter market, not in diminution of our national interests but to enable more commuting by rail from towns and cities currently poorly served within the Network Rail and Train Operating Company franchises to make millions of daily routing journeys better.
Consider for a moment the surreal situation in which our nation finds itself. I make no personal criticism of the PM or the Government. I know the PM is someone who cares about our country, who is trying to do the right thing as she sees it, and we know how demanding leadership is but the PM has the capability and capacity to change from HS2 to more schemes to improve direct commuting for more people.
But just consider: nine months ago both she and the Chancellor, were telling us that HS2 would be good for the country, its economy and its place in the world. Today it is apparently the MP’s ‘once in a generation opportunity’. The people consider it is time to change from this HS2 to a number of projects across Britain to bring daily benefits for more people. The Chancellor is telling us austerity still dominates the economy and inflation is increasing to lower the value of the pound.
Two years ago the Foreign Secretary was emphatically in favour of HS2. Ditching it now may be wiser than building up more foreign owned debt. The PM says she wants Britain to be a great open trading nation. Our first step in this endeavor is be measured in increasing debt. How to begin this worthy undertaking. To get out of HS2 thus leaving us with the opportunities to improve the Network Rail capacities and London Underground capacities to construct more track sections and extra tracks within and adjacent to the existing routes.
We can now start laying the wider rail improvement foundations, such a noble cause. By threatening thousands of people with expropriation of land and loss of businesses and facilities is the antithesis of that cause. There is a jumble of contradictions with HS2 that shows that the PM and the Government are not masters of the rail improvements situation. They’re being driven to finance largest scale construction that will deplete capacities elsewhere in the UK. And as we pass each milestone so the rail landscape, in which we are operating, changes not because we have willed wider change, but because this is the direction in which the HS2 domination is heading for the debt mountain. Will they trigger HS2 not because they do not know more beneficial destinations, but because the politics of not doing so, would alienate those self interested contractors who are driving tomorrows debt and tax burdens.
The surreal nature of the exercise is enhanced by the curious absence of a big argument as to why this continues to be a good idea. Many of the main themes of HS2 barely survived the consideration of the people affected. Virtually the only practical arguments still advanced – under the general rubric of ‘improvement’ – is the property development. This is not dependent on HS2 and can be stimulated by other projects.
Now we’re told we have to stop debating HS2 and just do it. Frankly, I would question whether a referendum will really provide a mandate for HS2 At Any Cost with £200 Billion being mentioned. But suppose that it does. The argument is then that the British people have spoken; we must deliver their will; and we should just ‘get on with it’. I agree ‘getting on with it’ is a very powerful sentiment, at present the predominant sentiment but the people will want more improvement for their daily journeys not long distance only use of HS2. Not Javelin commuting to have wider appeal and use.
But were we to be true to the concept of Government through British Parliamentary democracy representing the public directly declared requirements, rather than a whipped Government and MP self serving interest costing MPs less money to use than the public, we feel obliged to point out that it isn’t a question of just ‘getting on with it’ but getting value for money for more people. This is not a decision that once made is then a mere matter of mechanics to implement. It is a decision which then begets many other decisions and much local damage and disruption for communities and the public. Every part of the decisions from money to access arrangements is itself an immense decision with consequence. If we were in a rational world, we would all the time, as we approach those decisions, be asking: why are we doing this and as we know more of the costs, is the pain worth the gain. Unfortunately this HS2 route is only operable when all is constructed £200 Billion later.
Let us examine the pain. This impacted everything from consultation to forms to petitions and then to real loss of land and businesses location by location across hundreds of miles for roads, farm land and communities.
We will pay for the HS2 costs and not benefit from other future opportunities. We will lose influence in the most significant benefits of not improving the Network Rail and London Underground rail routes. There is alarm across counties and communities and the cities as public funding will be withdrawn. And all this then to do one HS2 route as we abandon the existing vital rail route improvements.
HS2 is without precedent over complex. It is even possible that it fails and we end up with both worse existing rail services and abandoned HS2. This is in itself another mine field: we would need to negotiate the removal of incomplete construction and tunnels adding costs.
This could take years. The price of imported goods are up and thus the cost of living. But making the best of a bad job doesn’t alter the fact that it isn’t smart to put yourself in that position unless you have to. We do not have to build HS2 we may regret it and want to rid ourselves of it.
We are already seeing the de-stabilising impacts and the challenges the country faces which stokes the discontent with HS2, the aftermath of the financial crisis; stagnant incomes for many families; no access to local and regional work, health and social services and schools.
Nothing else but HS2 seems to matter: not the NHS, now in its most severe crisis since its creation; not the real challenge of the modern economy; not the upgrade of our education system to prepare people for this new world; not investment in communities left behind by urbanisation; not the rising burden of crime; or bulging prison populations; or social care.
Governments’ priorities are not really defined by white papers or words; but by the intensity of focus. This Government has bandwidth only for one thing: HS2. It is the waking thought, the daily grind, the meditation before sleep and the stuff of its dreams; or nightmares. It is obsessed with HS2 Y. Why?. Future historians will be scurrying to investigate the antecedents of this HS2 obsession, why are they willing to sacrifice so much. What will they find – that they were a terrible group of MPs.
Some were ideological in their opposition; some had done a cost/benefit analysis and concluded better out than in. We must expose the agenda of the HS2 ideologues; and persuade those interested in the poor cost/benefit ratio. For the latter, we must – day in day out – articulate the reality: the pain is large and the gain largely illusory. But the HS2 ideologues are the ones driving this train which only Mrs May can resolve by change.
Indeed, what many Government Ministers think and say is the exact opposite of what the mass of voters and people think.
HS2 will not mean more money for the NHS but less. It will not mean more rail services for commuter, but less. But as of now the British people wouldn’t vote for it. So the HS2 ideologues know they have to get HS2 underway by producing false claims; they tell us this is the only future which works. It is not. In defeating them we have the challenge to persuade Mrs May to be practical and reduce the debt burden arising with this HS2.
The challenge is the absence of an MP Opposition. We need to strengthen the hand of the MPs who want different approaches and not HS2. There is an urgent need to re-position the whole debate around improved rail commuting across Britain and how we make it work for more people.
The one incontrovertible characteristic of politics today is its propensity for MP revolt. HS2 consultants are the beneficiaries of this wave; now they want to freeze for 20 years of guaranteed disruptive work. They will say the will of the people can’t alter. It can. They will say HS2 is inevitable. It isn’t. They will say we don’t represent the people. We do, many millions of them and with determination many millions more. They will claim we’re dividing the country by making the case to not construct HS2. It is they who divide our population between rich and corporate travellers and the public who want daily commuter rail service to and from school and work. This is the time for retreat from HS2, and the time to rise up in defence of what we believe – calmly, patiently, winning the argument by the force of argument for different rail project improvements without fear and with the conviction we act in the true interests of Britain having better rail services and tube services.
Can people and the Prime Minister overturn this extreme costly mistake. Please try and persuade a revaluation of the extreme cost that will remove the benefit for many more improvements.
Presume this 200bn doesn’t include local connection costs
http://www.railtechnologymagazine.com/Rail-News/hs2-can-only-be-as-good-as-local-rail-connections-make-it