Tuesday 27 August 2019 7:43 am

Government ‘knew for years’ that HS2 will blow its budget

The government has known for years that HS2, Britain’s controversial new high speed railway, is running over budget and behind schedule, it is reported.

The Department for Transport (DfT) and HS2’s managers knew at least as early as 2016 about the project’s troubled outlook, according to documents seen by the BBC.

Read more: Why it’s time to dream up something better than HS2

These papers date back to three years ago, before parliament approved the first stage of the project.

This suggests that MPs did not know the true extent of HS2’s spending projections and timescale when signing off the initial phase.

A DfT spokesperson said: “HS2 is Europe’s biggest construction project and like all major, complex projects, delivery plans evolve over time. ”

HS2 is due to link London and the west Midlands in a first phase delivered in 2026, before a second phase connects Birmingham, Leeds and Manchester by 2033.

Last month transport minister Nusrat Ghani told MPs in the Commons that HS2 would be delivered on budget and on time. But the documents seen by the BBC contradict that.

Former chancellor George Osborne discovered in May 2016 that phase one of HS2 was already £1bn over its £24bn budge, the BBC said.

A DfT briefing document in December 2016 admitted that even if HS2 cut costs elsewhere, “a significant gap to target price will remain”. It would have to open a year late, it added.

A letter leaked last month claimed HS2 could blow past its budget by £30bn.

Prime Minister Boris Johnson last week launched a review into the scheme amid fears over its costs and deliverability.

Costs swelled from an initial £55.7bn to £65bn, while Johnson has admitted the price of building HS2 could exceed £100bn.

Transport secretary Grant Schapps’ review, conducted by former HS2 boss Douglas Oakervee, is due to deliver a decision by the end of the year.

Read more: HS2 faces the scrap heap as Boris Johnson kicks off review

“The new Secretary of State has established an independent review into HS2. Led by Douglas Oakervee, the new report will set out, before the end of the year, the latest position on cost and make recommendations on whether and how to proceed,” a DfT spokesperson said.

“The new Secretary of State will provide Parliament with a full update on all the information he has received next week.”