HS2 boss admits new £100bn cost is ‘terrible news’

The boss of HS2 has admitted it is ‘terrible’ the budget for the hugely delayed high speed rail project is set to balloon to £100bn.

Mark Wild, who was parachuted in to ‘reset’ the beleaguered project after rescuing London’s troubled Crossrail project, also told MPs today that he was convinced it would not be delayed any further after years of setbacks.

Yesterday, Transport Secretary Heidi Alexander admitted costs will be somewhere between £87.7billion and £102.7bn in 2025 prices, and the first trains will likely launch between May 2036 and October 2039 on part of the line.

When first announced more than a decade ago, HS2 was set to cost £32.7billion for the leg from London to Birmingham, and services were due to begin this year. 

But the project is now delayed and massively over budget – with trains will run slower than planned at a maximum of 199mph rather than 224mph, despite the fact the tracks will be built to withstand the greater speed.

Speaking to the Transport Select Committee this morning, Mr Wild – also a former London Underground boss – said: ‘Let’s just acknowledge what bad news this is: from the budget set in April 2020 that was £42-43bn, that number has doubled.

‘This is terrible news and we have to think about the reasons for that.’

The HS2 boss said spikes in inflation, particularly those driven by the war in Ukraine, were partly to blame for the spiralling costs – along with the fact construction on HS2 began in 2017 before the design had been fully completed.

And he insisted he ‘understood’ that government and taxpayer money ‘really counts’. 

Mark Wild, chief executive of HS2, has admitted the surging budget and spiralling delays to the high-speed project are ‘terrible news’

Rail minister Lord Hendy said taxpayers would be ‘rightly horrified’ by the issues that continue to plague the beleaguered rail project

‘I will repeat that I’ve always said it will take two years to reset HS2. And I am sorry I can’t reset this faster but I think the committee would agree we only get the chance to reset this once. It’s the right thing to do,’ he added.

Track laying for HS2 will begin next year, with the first operational route between Old Oak Common in west London and Birmingham’s Curzon Street station expected to commence sometime between May 2036 and October 2039.

They will not reach a newly built HS2 terminal at London Euston until sometime between May 2040 and December 2043.

Then services will also travel to Handsacre Junction in Staffordshire before merging onto the existing West Coast Main Line at a rate of up to 10 trains per hour, Department for Transport official Dean Creamer said.

Pressed by MP and civil engineer Dr Scott Arthur, Mr Creamer thundered: ‘This is not poor value for money.’ 

Even now with construction well underway, HS2’s design is only ’80 to 90 per cent complete’, Mr Wild said. 

And he openly confessed HS2’s budget and timeline were a world apart from high-speed projects in Europe, which he admitted were built ‘in faster time’.

France has just signed off plans to build 222km of high-speed rail between Toulouse and Bordeaux for its super-fast TGV trains.

It’s roughly the same distance as the HS2 line from London to Birmingham but has been budgeted at just €8.5bn (£7.3bn), a fraction of HS2’s cost.

In fact, the Artemis moonshot programme that recently sent NASA astronauts around the moon for the first time in decades has cost less to date – $93billion (£69.5billion).

Asked if he could complete HS2 with the original budget and original timescale of £45bn and 10 years, Mr Wild said: ‘I don’t know.’ 

He admitted those in charge had ‘lost control’ of the project prior to his appointment – as it emerged HS2 bosses met with ministers just four times in three years prior to the General Election.

But he pledged a year from now the project will have a ‘high-fidelity’ schedule to bring it back into line – with ‘exceptional’ engineering.

He added: ‘When I arrived in his job the project had become completely uncoordinated. There is a reality that we had lost control of the project.

‘We will get into a position of April 2027 where matters of reserve and contingency come under normal controls.

‘I know I’m promising jam tomorrow but I’m convinced the bookends of time are robust and the baseline will fit within it. We will manage this project in an orderly and transparent way.’

Transport Secretary Ms Alexander yesterday blamed the surging cost of HS2 on ‘past misunderstanding of the work required, underestimation and inefficiency, issues within the control of HS2 Ltd, some of its suppliers, and previous governments’.

Part of the work to remove the ‘gold plating’ of the project would include reducing the focus on the ‘highest possible speeds’, she added – alongside the removal of automatic train operation and a cheaper, existing signalling system.

Mr Wild told the committee this would equate to an initial saving of £2.5billion in a year.

HS2’s original route was supposed to connect London with Leeds and Manchester, but the two northern legs were axed amid spiralling costs and delays 

A new terminal for HS2 is being built at London Euston (pictured) but may not be operational for another 17 years

Rail minister Lord Hendy said anybody watching proceedings would be ‘rightly horrified’ by the handling of the project. 

‘This is a disastrous place to be at a project at this stage,’ he said.

Addressing committee chair Ruth Cadbury he added: ‘We’re confident with this process but you would’ve liked this process to start quite a long time ago, wouldn’t you?’ 

These cost-cutting measures would bring HS2 into line with European specifications for high-speed rail, rather than exceeding them – branded a ‘massively over-specced folly’ built at the whim of the Conservative government by the minister. 

But Dr Scott Arthur, a Labour MP and civil engineer, said of the plans to slow trains down: ‘We’re going to design things as intended lines but the trains are going to run slower. That seems a bit odd, doesn’t it?’ 

Lord Hendy said of the speed reduction: ‘The additional three minutes of journey time is neither here nor there.’

Mr Wild added: ‘It’s actually not a slow train. We’re converging this with the fastest trains in Japan and France.’

Further scrutiny of the troubled project is to come: the Public Accounts Committee has launched an inquiry into the delivery of HS2 and the new Euston terminal and will quiz officials before Parliament’s summer recess.

David Davis, Conservative MP and a frequent critic of the HS2 project, said it had been a ‘white elephant from day one’ and ‘a colossal waste of taxpayers’ money’.

He said: ‘I said from the start the costs were absurd. Back in 2019, I launched a report proposing much better ways to spend the money.

‘Instead, we’ve got spiralling budgets, gold‑plated design, slack oversight, and no accountability. Billions sunk for a line that keeps shrinking. The very definition of inefficient, ineffective, and unaccountable infrastructure spending.

‘This new review does not surprise me. It simply confirms what we already knew – HS2 was a disaster baked in from the start.’