Cameron calls for parties to be united over HS2

The Prime Minister announced that Sir David Higgins, the new boss of the planned high-speed link, has been tasked with finding ways to cut the estimated £50bn price of the scheme, to drive down costs and “make it affordable for our country”.

Speaking to the CBI’s annual conference in London, Mr Cameron dismissed as “nonsense” suggestions that there were other ways of cutting back the cost of modernising the railways, insisting HS2 was a “vital investment” which would ensure growing prosperity is not confined to the South but is shared with the North.

The scheme needs cross-party approval if it stands a chance of being built, but Shadow Chancellor Ed Balls threw Labour’s support into doubt by raising concerns about the spiralling costs earlier this year, insisting he would not sign a “blank cheque”.

In a clear swipe at Labour, Mr Cameron said: “To people who say there is some other cost-reduction plan we could also have, I say that is nonsense. I think with Sir David Higgins in charge, with the budget we have and the contingency we have, this is a good investment for Britain.

“People who are against it, in my view, are putting our country’s future at risk, they are putting the future of the north of England at risk. We need to have a concerted consensus across business, across politics, that we get behind these large infrastructure projects.”

He rejected arguments that the cost of HS2 will divert investment away from other necessary work on the UK’s transport network, pointing out that the planned spending on the project in the period 2015-20 totals £16bn – less than a quarter of the £73bn overall budget for improvements to roads and railways.

Former chief executive of the London Olympic Delivery Authority Sir David, who takes over as HS2 chairman next year, believes the scheme can come in at “substantially” less than current estimates by trimming the £14bn earmarked for contingency costs.

And Mr Cameron told the CBI: “I want to make sure we get every penny of value for money from this HS2 investment. I think it is fantastic that Sir David Higgins – the man who built the Olympics on time and on budget – is going to be running HS2.”

Speaking to his audience of businesspeople, Mr Cameron painted a positive picture of the condition of the UK economy, telling them: “We’ve got a lot of work to do, but we are on the right track.”

He restated his determination to stick to George Osborne’s economic Plan A of deficit reduction, which he named as one of five essential components of the UK’s return to prosperity, alongside education, welfare reform, investment in infrastructure and encouraging enterprise.