Still time to get HS2 back on track but we need to rethink our approach to large infrastructure projects - Henri Murison
It was a rare moment where we celebrated transport for the massive role it plays in our lives, in supporting business and driving the economy, in helping us get to that dream job or visit friends and family.
If you’d googled the project, also known as Crossrail, a few years before then, it would have been a very different story. Transport infrastructure schemes - particularly the complicated ones – are more often than not beset by problems: delays, spiralling costs, unhappy local residents.
Things had got so bad that in 2019 the Infrastructure and Projects Authority (IPA) had given the project a red rating – meaning there were “major issues with project definition, schedule, budget, quality and/or benefits delivery, which at this stage do not appear to be manageable or resolvable.”
Last week the IPA gave the same verdict to the first two legs of HS2, along with a worryingly high number of other schemes and projects.
Cue outcry from the anti-HS2 lobby looking for any excuse to bin the whole thing.
Believe me, I understand the frustration. France, Germany and Spain all build high-speed rail networks for tens of millions per mile. Why does it cost the UK so much more?
There are a number of (largely avoidable) reasons. For one thing, we are paying a very heavy price for the constant chopping and changing, both of the route and the stations. £100m of design work has been wasted on Euston alone due to a decision to cut down the number of platforms by just one.
Moreover, a series of delays have left us much more exposed to the wider challenge of construction cost inflation. Earlier this year the government decided to pause key sections, even though Transport Secretary Mark Harper himself admitted that the delays wouldn’t save any money – directly triggering the IPA red rating.
Worse than that, leaked figures from the Department for Transport revealed the delays would in fact add £366m to the section between Birmingham and Crewe and £200m to Euston station, for the sake of meeting arbitrary spending targets for the year.
So, what now?
Phase 1 of HS2 (the most expensive part of the scheme) is over 40 per cent built – even many detractors agree it makes no sense to scrap it now.
Firstly, we need to make sure the review on how to get HS2 trains to Leeds is ambitious enough to bring back former supporters, including Yorkshire’s own William Hague, who feel (correctly) that the project lost much of its economic impact when the Eastern Leg was axed.
Secondly, we need to finish Euston and push ahead with the line up to Manchester through Manchester Airport. We also need to get spades in the ground on the linked Northern Powerhouse Rail line to transform that all-important east-west connectivity across the Pennines and up to Newcastle, with a through station in Bradford.
That is how we will unlock much-needed capacity on our rail network that improves transport links both across the country and at a local level. This will allow us to increase the number of passenger and freight services, taking cars and lorries off the road.
Lastly, we need to learn the lessons from the last decade and work out how to deliver large-scale infrastructure more efficiently from now on.
For one thing, let’s put an end to politicians and civil servants meddling and have no more tinkering. One idea from William Hague is for powerful and accountable policy and delivery boards, independent from government departments, with engineering experience and knowledge.
It is also time to reform the government’s overly simplistic fiscal rules which limit growth and encourage short-termism.
The Shadow Chancellor last month restated the difference between borrowing to invest and borrowing to fund day-to-day spending like welfare benefits. This means her fiscal rules would not lead to the artificial deferment of costs, as happened this year on HS2.
By trying to leave room for a pre-election tax cut, the government has ended up increasing the debt burden on future generations with no political gain to show for it.
This is no way to run the country. It is bad news for the North of England which is in dire need of a connectivity transformation, delivered through a consistent package of improvements by future parliaments.
Instead of shiny new initiatives that last five minutes, we need long-term investment and devolution to turbocharge the North’s sluggish productivity, a huge factor in the UK’s continued underperformance.
There’s still time to get things back on track – we can’t afford to stop now.
Henri Murison is chief executive of the Northern Powerhouse Partnership.