Ministers’ unhelpful messaging around HS2 is damaging to UK plc

A “go slow” order on a project invariably spells trouble for those tasked with building it. It is a clear sign the client has got cash flow problems on a job where the costs are proving unpalatable. And when the project in question is the size of HS2 and the client is the government, that is cause for the whole industry to be concerned.

In a blow to common sense, the Department for Transport last week announced HS2’s Phase 2a leg from Birmingham to Crewe would be delayed by two years, and from now on work would be prioritised to deliver services between Old Oak Common in west London and Birmingham Curzon Street, which leaves Euston station to be reviewed (read into that “valued engineered”) once again.

We, of course, know the reasons. The government is strapped for cash and HS2, now many billions over its original estimates, is unpopular among many Tory MPs, much of the mainstream media and the public, so with a general election looming it is, frankly, an easy target.

The transport secretary explained how his department’s capital programme had been affected by “challenging economic headwinds” caused by the war in Ukraine and post-covid supply chain disruption. Notable by its absence was any mention of the £30bn hole in the economy after Liz Truss’s mini-Budget.

This is all frustrating news for the firms working on HS2. Let’s just think about Euston station for a moment and the heated discussions that will be happening behind closed doors to work out what to do next.

The irony is the very people moaning about the overall price tag are making it more expensive every time they call for another review or delay

It was originally meant to complete in 2026 and cost nearly £3bn. Cost estimates have increased to closer to £4bn, and now apparently ministers want to get it back to the original budget by scaling back the scope and delaying completion until 2035 at the earliest. We should remember it is not simply a station that needs more platforms; it is a transport interchange and a regeneration project with a vision to become a commercial and residential hub in the capital.

There are more than 350 people currently working on the site for the construction partner, the joint venture between Mace and Dragados, while the design team comprising WSP, Grimshaw and Arup has about 600 people on the job. All those people understandably could be feeling nervous right now, although working for big companies, in all likelihood they will be redeployed.

Employers may be able to protect jobs, but they cannot prevent the loss of project knowledge when teams get dispersed and parts of the site mothballed. And we must not forget that the worry will be even greater for SME businesses reliant on HS2 contracts; they have far fewer options for staff.

It all amounts to a huge waste of expertise and resources. As Sir John Armitt says in our interview, decisions to delay never save money, they simply pile on cost further down the track. The irony is the very people moaning about the overall price tag are making it more expensive every time they call for another review or delay. Armitt is absolutely clear: the way to get value as a client is not to drag your feet on investment decisions you have already made, but to do the opposite and go faster.

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Armitt is an expert in these matters, but the government appears to have closed its ears. So what will become of HS2? Will it be so pared back from its original vision that it loses its purpose? You do begin to wonder, when people start floating the idea of dropping Euston altogether and terminating the line at Old Oak Common. This is obviously a non-starter; it would be the equivalent of delivering HS1’s Channel tunnel link as far as Ashford. It would also be farcical to arrive at a new Euston station where all of the regeneration plans for the surrounding area had been designed out. Why spend billions and not invest that bit more in the job creation that would result from well-designed and integrated commercial, retail and hospitality space?

HS2 will always have its arch enemies, but work will go ahead. How much is still up in the air. There will be lots of tense talks in the next few weeks and months about how to shave off cash here and there at Euston, “work-arounds” will no doubt be found.

What is more significant, however, is the damaging message this stop-start approach on HS2 sends to businesses looking to invest in the UK. Arguably this is the current administration’s big mistake. The country’s route to economic recovery and a greener future is investment in transport and energy infrastructure, as well as in the homes and social infrastructure we sorely lack. Construction is dealing with politicians whose focus is stubbornly short term and whose priorities are misguided. Ministers can delay investment but ultimately we all pay the price. The case to get building is now overwhelming.

Chloe McCulloch is Building’s editor