HS2 Property Cost Forecast at Five Times the Original Estimate, FOI Shows

A Freedom of Information Response from HS2 Ltd forecasts that the final total for the cost of land and property on the London to Birmingham stretch would be around £5bn, five times over the original budget presented to Parliament. Whilst the original budget for land and property presented by HS2 Ltd to Parliament was £1.1bn, over £2bn has already been spent with fewer than half of the properties required having been bought.

Currently, HS2 Ltd have bought around three quarters of the residential properties needed to build phase one of the proposed scheme, they have bought fewer than two fifths of the more expensive business, commercial and farm properties they need, putting the forecast final cost at five billion pounds (£4.96bn).

The voracity of the forecast of HS2 property costs has been in question ever since whistle-blower Doug Thornton revealed that many properties had been valued at zero. Thornton later quit HS2 Ltd, after being told to tell the board that the cost estimate was still £1.1bn, when his more detailed assessment had put the cost at £3.3bn. In September 2018, the National Audit Office report confirmed that it was “Too soon to determine with certainty what the final outturn will be.”

On 9^th January and following a BBC Panorama investigation into HS2 Ltds policies concerning the acquisition of land and property, members of the Stop HS2 Bramley Action Group submitted FOI requests to both HS2 Ltd and the Department for Transport asking how many of various type of property will be required, how many have been purchased, and how much has been paid out. Whilst the annual accounts of both HS2 Ltd and the DfT state that the purchase of property is specifically the responsibility of the DfT, the department replied in January saying that they did not hold the information. The response from HS2 Ltd states that out of the 368 homes that are needed, 279 or 76% have been bought at a cost of £246.5m, but of the commercial, business and ‘other’ properties required, only 466 of the 1196 (39%) have been bought, at a cost of £1804.5m. Overall, 745 of the total of 1564 properties have been bought at a cost of £2,051m.

Whilst these figures would leave an estimated £78.6m still to be spent on residential properties, a forecast of £2,852m would be needed to buy the rest of the land and property on Phase 1, bringing the overall total to £5bn. Stop HS2 campaign manager Joe Rukin responded:

“Yet again, when we find out more of the truth that they are trying to hide about HS2, we find out the costs have gone up by a couple of billion yet again, and if they haven’t bought all the land yet this proves they are way behind schedule, but we will get the same old fingers in ears response that HS2 is ‘on time and on budget’. HS2 Ltd just keeps limping on without any scrutiny from politicians who prove every day that they do not care how much their vanity project costs. The fact that just one element of the costs of this white elephant could be out by a factor of five, should be enough for any rational person to question the validity of every figure associated with HS2, but if rational people were in charge, HS2 would never have got this far.”

“What these figures hide is the number of people who have been left hanging on without being paid and those who have been bullied by their own government into accepting less than their properties were worth.”

Penny Gaines, chair of Stop HS2 added:

“These latest figures show just how badly HS2 Ltd underestimated the costs of buying land for building HS2.  With less than half the properties bought for Phase 1, they have already blown twice the original budget.”

“HS2 is a vastly expensive white elephant, with all the signs of busting its massive budget, it’s time to cancel HS2 and ensure everyone who has already had their property taken has been properly compensated.  Then the Department for Transport can get on with dealing with the rail and road issues that affect millions of people across the whole country rather than enabling a few people to get to London a bit faster.”