Is the Eastern leg of HS2 for the chop?

Just recently, there have been a number of news items suggesting that the Eastern leg of HS2 from Birmingham to Leeds might be scrapped – see here, here and here for example.

The government have asked HS2 Ltd to “pause” work on the Eastern leg, but will it be cancelled, or will it be unpaused?

Listening to what politicians have said can give clues, with the proviso that politicians are experts in saying things that could mean anything.

For example, Cheshire Live reports

During HS2 Minister Andrew Stephenson’s visit to Crewe Railway Station on Tuesday (August 24), he was asked to confirm or deny the reports during an interview with CheshireLive.

He said: “At the moment as you will know, we are working on the Integrated Rail Plan looking at the sequencing of investment in the north and the midlands.

“That will come out soon and will give people that clear direction of travel from the Government. I am very keen to get that published soon but I am firmly committed to ensuring that Yorkshire and the East Midlands benefit from high speed rail services.”

And in an oral evidence session with the Transport Select Committee, Andy Street told them

“You do not need to build the whole of 2b eastern leg high speed for West Midlands business to get what it needs for connectivity across the Midlands”

and that he wanted a commitment to the Midlands Rail Hub that would provide

“connectivity into the centre of Birmingham, much greater capacity and also the rapid links between Birmingham, Nottingham, Derby, Leicester and Coventry-Leicester”.

In both cases, the two politicians are leaving it open as to whether the eastern leg will be formally cancelled, or left in limbo for longer.

It is also clear that the government will need to make some big decisions about spending and the best use of taxpayer’s money.

Looking at cost savings effort on the HS2 project previously, what has happened is that rather than reducing the final bill, it has risen inexorably upwards, with parts of the plan being ditched as costs rise.  The easy bits have long since been cut such as the Heathrow extension, a full Euston refurbishment and the link to HS1. They’ve even done some of the more difficult decisions -HS2 will run to Old Oak Common when it starts, with the Euston sectionopening later.  But there are cost pressures everywhere, such as rising material costs. At some point they will have run out of easy things and will need to amputate bigger parts of the project.

This is politically hard to do. Boris Johnson is boxed in by his levelling up agenda, where cutting HS2 would lead to predictable claims that he is ditching his whole agenda. But the difficulty is often getting between relatively close towns and cities, not in being able to get to London.

It’s not as if HS2 is going well. The latest Infrastructure and Projects Authority (IPA) rates HS2 Phase 2b as red. The definition of red is “successful delivery of the project appears to be unachievable. There are major issues with project definition, schedule, budget, quality and/or benefits delivery, which at this stage do not appear to be manageable or resolvable. The project may need re-scoping and/or its overall viability reassessed“.

The more surprising thing is that even though they had a big reset at the time of the Oakervee review HS2 Phase 1 is still rated amber/red.  Doubling the budget for HS2 has not improved the viability.

And that is before you look at the wider picture of whether HS2 is needed in a post-COVID world.

The pandemic has had a massive effect on travel. As a direct effect of lockdown instructions to work from home if possible, many businesses now operate a hybrid mode of some work from home, some in the office. This has had a massive effect on rail usage bottoming out at a mere 3% of pre-pandemic rail usage. As the ORR says

“A total of 388 million rail passenger journeys were made in Great Britain in 2020-21. This equates to 22.3% of 1,739 million journeys made in 2019-20 and represents the lowest level of annual passenger usage since before the time series began in 1872.”

Since that was published rail usage has since risen but still less than two thirds pre-pandemic use in August.  Commuters holding season tickets is now 22% of pre-pandemic levels. The rail industry’s worries are now about whether they’ll get back to getting back to ‘normal’ levels of usage, not about coping with growth

Another issue is the difficulties of actually building HS2 in the area.

One of the big problems is that the Eastern leg of HS2 will go across large areas of former coal mining, and they simply don’t know where the mines were. This might be OK for normal speed rail, but its not OK for trains that are expected to go close to 225mph. (There are likely to be similar problems in Cheshire where salt mining took place.)

We are not getting out the bunting yet, we have seen similar wobbles before. But far from being a silly season wobble, this could signs of a genuine shift.

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