Lord Berkeley, the former chair of the Rail Freight Group has accused HS2 Ltd of committing cover-ups and fraud. In a speech to the House of Lords Grand Committee, the peer claimed that £2.7m of public money was used to pay off whistle blowers, and the former chair of the company signed off the estimates of cost for the project, knowing they were incorrect.
Comparing the delays and cost over-runs of HS2 with those of the Crossrail project, Berkeley said:
“HS2 is 10 times worse, not only because its costs are very much higher than that of Crossrail but because the evidence of cost overruns, cover-ups and, I must say, fraud and worse are rampant even before the permanent construction work has started.”
He accused officials of putting their heads in the sand, adding that:
“I fear that there is a concerted effort by officials and successive Ministers to prevent scrutiny of the costs and programme, to refuse to discuss ways to reduce costs and generally to batten down the hatches over a six-year period.”
On the culture of secrecy within the organisation, he said:
“There is a churn of staff which is disastrous in such a project: get rid of people who know too much or who disagree with the policy and we will keep to the original budget over six years. The Permanent Secretary, Philip Rutnam, was promoted to the Home Office when the original cost estimates were challenged, and David Prout, who was responsible within the Department for Transport for HS2, retired to run an Oxford college. HS2 has had at least four chairmen in that period. The chief executive, Alison Munro, felt able to sign the estimates, knowing, I think, full well that the budget was shot to pieces. She left soon after, as did Beth West and Jim Crawford, who resigned last week.”
“Two whistleblowers, Andrew Bruce and Doug Thornton, who are both highly skilled professionals on property issues, were sacked half an hour before they were due to present their findings on property costs to the Department for Transport’s client board. They were sacked because they refused to lie about property cost estimates.”
“The last matter here is that Simon Kirby, a former chief executive, was found a job at Rolls-Royce—very conveniently—because he was blamed for awarding £2.7 million of unauthorised redundancy policies to HS2 staff, which I have on good authority was actually used to pay off the whistleblowers. This is a very sad situation, coupled with a culture of secrecy.”
That last revelation, that public money was used by a Government quango to pay off whistleblowers has the potential to rock the project to its core. It was already known that these payments were unauthorised, as first HS2 Ltd officials and been told not to make the payments by the DfT. Then, CEO Simon Kirby had gone directly to Chris Grayling to authorise the payments. He was turned down again, but made the payments anyway and soon after he left HS2 Ltd for a job at Rolls-Royce.
Stop HS2 Campaign Manager Joe Rukin responded:
“Right from the start HS2 has been immune to any scrutiny, with Ministers and officials doing everything they can to make sure the public do not know the truth about this project. This has not only led to a culture of secrecy, but a genuine belief within HS2 Ltd that they can get away with anything they like. The cost over-runs, cover-ups and fraud Lord Berkeley says have happened would only be inevitable and inescapable consequences of such an attitude of arrogant invulnerability.“
“With HS2 having spent a decade lurching from one scandalous disaster to another, we have always wondered why there have not been more whistleblowers, so this suggestion from Lord Berkeley that public money has fraudulently been used to buy their silence makes complete sense, and is exactly the sort of thing we would expect from this rogue organisation.”