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High-speed rail between London and Birmingham may never be delivered because the government and HS2 lack “the skills or capacities” to complete the project, a powerful committee of MPs has warned.
The Commons public accounts committee (PAC) said the rail project should be studied as an example of “how not to run a major project”, with billions of pounds of taxpayer funds having already been wasted.
And, despite the northern leg of HS2 having been axed to cut costs, a move first revealed by The Independent, the PAC warned it has doubts about the government’s ability “to deliver even a curtailed scheme”.
In a damning report, the committee added that even if the slimmed down HS2 project is delivered, it will “bring very poor value for money”. One example the committee cited in the waste associated with HS2 was the building of a bat protection tunnel in Buckinghamshire costing more than £100m.
PAC chair and senior Tory MP Sir Geoffrey Clifton-Brown said: “The question has instead become: what possible benefit can the government now salvage for the taxpayer, from a mess that presents real risks to the UK’s overall reputation?”
The report blamed the Department for Transport (DfT) for having “failed in its oversight and financial control” of the scheme.
It also said HS2 Ltd – the government-owned company responsible for building the high-speed railway – and the DfT have “failed to work together effectively”.
This is “starkly illustrated by their continued disagreement” over how much it will cost to build the line from London to the West Midlands, it stated.
The DfT’s estimated range in November 2023 was £45bn to £54bn, while HS2 Ltd’s latest estimate in June 2024 was between £54bn and £66bn.
All these figures were in 2019 prices.
Once adjusted for inflation, the cost “might be close to £80bn”, according to the report.
The PAC said: “The HS2 programme has become a casebook example of how not to run a major project.
“It is unacceptable that over a decade into the programme we still do not know what it will cost, what the final scope will be, when it will finally be completed or what benefits it will deliver.”
Shortly after joining HS2 Ltd as chief executive at the start of December 2024, Mark Wild said the project was “in a very serious situation that requires a fundamental reset”.
In October 2023, then-prime minister Rishi Sunak cancelled a plan to extend HS2 between the West Midlands and Manchester. The Independent revealed the PM’s plans weeks in advance, sparking fury among northern politicians and business chiefs.
The planned leg to Leeds was axed in November 2021. A previous review was carried out in 2020 because of escalating costs and delays.
The PAC said: “The department and HS2 Ltd must not waste this latest opportunity to reset the programme properly, learning lessons from past mistakes and maximising for the taxpayer what value they can from this huge investment.”
But the committee also noted there are “significant risks” with the redevelopment of London’s Euston station.
The government confirmed in October last year it would pay for tunnelling work to the station from Old Oak Common in west London.
But it is “unclear how achievable” the DfT’s goal of Euston’s redevelopment being privately-funded is, the PAC said.
Sir Geoffrey said: “It is time to deal with HS2 as what it is – a cautionary tale that should be studied by future governments in how not to run a major project.
He added: “It is ultimately the Department for Transport that has failed to manage this enormous project and manage HS2 properly.
“This is likely to have wasted billions of pounds of taxpayers’ money in delays and overspends.”
A spokesperson for HS2 Ltd said: “Mark Wild, our new chief executive, agrees with the committee’s conclusion that there has been failure in the management of HS2’s cost and schedule.
“He is taking decisive action to get the project back on track at the lowest feasible cost.
“His fundamental reset is critical to ensure the successful delivery of HS2’s goals – driving economic growth and connecting our biggest cities with fast and reliable journeys.”
A Department for Transport spokesperson said: “The continuously climbing costs of HS2 are completely unacceptable. That is why the government acted swiftly to get the project back under control by bringing new leadership to HS2 Ltd, directing the company to begin work on resetting culture, schedule and costs, and reinstating robust ministerial oversight.
“HS2 Ltd is working with its supply chain to reset the programme and deliver the railway safely and at the lowest reasonable cost.”
