North-South gap ‘bridged by HS2 plan’

The Chancellor said the project was about “changing the economic geography” of Britain to make sure the North and the Midlands benefit from an economic recovery.

Mr Osborne would not be drawn on whether spending on HS2 could rise higher than the £42bn budget, insisting contingency costs had been built in to plans.

He told BBC1’s Andrew Marr Show: “We have set the budget for £42bn for the construction costs. That includes, by the way, a big contingency.

“As we demonstrated with the Olympic Games, we can deliver these big projects actually sometimes under budget.”

He went on: “I’m passionate about this project because time and again, we have this debate in our country about how we’re going to bring the gap between North and South together, about how we’re going to make sure that our growth is not just based on the City of London.

“High Speed 2 is about changing the economic geography of this country, making sure the North and the Midlands benefit from the recovery as well.”

Mr Osborne’s comments came in the wake of high-profile calls in recent weeks for the project to be scrapped from the Institute of Directors, Institute for Economic Affairs and former Labour chancellor Alistair Darling.