Delays to HS2’s Euston Leg May Lead to Higher Spending, Watchdog Warns

Undated image of a graphic representation of the HS2 trains which would run between London and Birmingham. (Hitachi Rail-Alstom/PA)

Delays in building the final stretch of the high-speed railway HS2 to Euston Station in central London will mean extra costs and potentially even higher spending, a government spending watchdog has warned.

Transport Secretary Mark Harper announced earlier this month that “inflationary pressures” will cause delays to the construction of key parts of HS2.

He said the Birmingham to Crewe line will be delayed by two years and the final stretch from Old Oak Common in west London to Euston in central London will not be ready until some time in the 2040s.

An HS2 construction worker walks past the Euston station site in central London on Jan. 27, 2023. (PA)

The changes are set to see services not reaching central London for years to come. That means that, when the first part of HS2 is completed, passengers arriving in central London—for example on Eurostar trains from Europe—and wanting to travel on to Birmingham will have to take the Elizabeth Line to Old Oak Common in west London to board HS2.

In a report published on Monday, the National Audit Office (NAO) said the postponement may allow the Department for Transport (DfT) to move the Euston end of the project to a more “stable footing.”

But it warned that the delay will lead to additional costs and potentially even higher spending overall.

Station Redesign

In October, New Civil Engineer reported that the DfT was admitting “significant elements” of the initial design for a station at Euston could no longer be used and the number of platforms would have to be reduced from 11 to 10.

According to the NAO report, the latest estimate by HS2 Ltd. set the cost for the 10-platform design at Euston at £4.8 billion, over £2 billion over-budget.

The report found that by the end of December 2022, HS2 Ltd. had spent more than £2 billion on the HS2 Euston station and its approaches, covering design, land, and preparation works.

NAO chief Gareth Davies said: “DfT and HS2 Ltd. have not been able to develop an affordable scope that is integrated with other activity at Euston, despite their focus on costs and governance since 2020. Recent high inflation has added to the challenge.

“The March 2023 announcement by the transport secretary pausing new construction work should now give DfT and HS2 Ltd. the necessary time to put the HS2 Euston project on a more realistic and stable footing.

“However, the deferral of spending to manage inflationary pressures will lead to additional costs and potentially a more expensive project overall, and that will need to be managed closely.”

The extra spending will arise from costs associated with stopping and restarting work, contractual changes, and managing the project for longer, the watchdog said.

Dame Meg Hillier MP in an undated file photo. (Jessica Taylor/PA)

‘Still Unaffordable’

Dame Meg Hillier, a Labour MP who chairs the Public Accounts Committee of the House of Commons, said: “Attempts to reset the High Speed 2 Euston Station have failed. It is still unaffordable and no further forward than it was three years ago.”

She said that the NAO report shows that “the redesigned station would have cost nearly double what was budgeted. The delays to fix this will be felt not only by the taxpayer, but will continue to disrupt people and businesses around Euston.

“Department for Transport and High Speed Two Ltd. have wasted enough time and money. They must get Euston right next time or risk squandering what benefits remain.”

A DfT spokesperson said: “We remain committed to delivering HS2 from Euston to Manchester in a way that delivers the best value for money to the taxpayer. That’s why we recently announced we will rephase the Euston section of the project to manage inflationary pressures and work on an affordable design for the station.

“We will carefully consider the recommendations set out by the National Audit Office and will formally respond in due course.”

‘White Elephant’

Harper said on March 10 that the government remains “committed to delivering HS2 services to Euston.”

But on Sunday, Levelling Up Secretary Michael Gove refused to guarantee that HS2 will terminate at Euston.

Asked on Channel 4’s “The Andrew Neil Show” whether he could guarantee the train route would end in central London, the senior Conservative said: “There is a debate about whether or not it should be Old Oak Common or Euston.”

Pressed on whether HS2 would go to Euston, the Cabinet minister replied, “I don’t know what the final decision will be about where the terminus will be.”

In reaction, campaign group Stop HS2 said on Twitter, “There we have it, HS2 will never reach Euston but may limp its way to Manchester by the mid-2040s.”

The group questioned why Prime Minister Rishi Sunak and Chancellor Jeremy Hunt are “continuing to burn more than £100 million per week on this white elephant project.”

The project has had more than its fair share of critics since it was first announced by then-Prime Minister David Cameron back in 2013.

Critics have said HS2 would cause huge environmental impact and presented terrible value for money when it would only be able to reduce the travelling from London to Birmingham by 29 minutes.

Chris Summers and PA Media contributed to this report.