Scrapping northern leg of HS2 is ‘a missed opportunity’, claims former Tory Minister

It comes after Parliament’s Public Accounts Committee published a report which stated only building the line between London and Birmingham, for up to £66.6bn, offers “very poor value for money”.

Lord McLoughlin, who served as Transport Secretary under David Cameron, said the original plan for a Y-shaped rail network linking London, Birmingham, Manchester and Leeds should have been delivered.

The Tory peer, who is now chair of Transport for the North, said “transformational investment” is still needed to improve rail connections to the north and unlock the region’s “huge economic potential”.

“The decision to stop HS2 at Birmingham is a missed opportunity for the north, and the country as whole,” he said.

“It wasn’t just the improved north-south connectivity it would have enabled, but the extra capacity it provided, both in terms of the new high-speed line and in the space freed up on the existing network to run more services. This would have benefited passengers and freight.”

After the eastern leg of HS2 to Leeds was scrapped in 2021, Prime Minister Rishi Sunak decided in October the line would stop in Birmingham and not run to Manchester.

The Department for Transport (DfT) then insisted Phase 1 (London to Birmingham) still offered “value for money”, partly because cancelling the entire project would incur costs of around £11bn.

However, the Public Accounts Committee said “there are many uncertainties in this assessment” and it was “left with little assurance over the calculation”.

The committee said Phase 1 now “offers very poor value for money” as the total costs “will significantly outweigh benefits”.

HS2 Ltd executive chairman Sir Jon Thompson has said the cost of delivering Phase 1 could reach £66.6bn once inflation is factored in. It comes four years after a budget of £44.6bn (2019 prices) was set.

The Government has disputed his estimate, claiming it will save £6.5bn by getting private investors to pay for the redevelopment of Euston station in London.

When Douglas Oakervee conducted a review of HS2 for Boris Johnson’s government in 2020, he concluded that “Phase 1 as a standalone scheme does not represent value for money”.

He also found that if the entire HS2 network was built as originally planned the costs would not outweigh the benefits unless the final bill exceeded £138bn.