London Daily News

HS2 rail delay will dent investor and contractor confidence, say experts urging a rethink

Short-term government thinking will dissuade young people from joining construction and engineering professions, says the Chartered Institution of Civil Engineering Surveyors

 

The Chartered Institution of Civil Engineering Surveyors (CICES) has questioned the logic behind the government’s decision to delay the Birmingham to Crewe leg of the HS2 high-speed rail project.

 

The internationally renowned organisation has raised concerns about the government’s short-term thinking after last week’s announcement of a two-year delay and has urged the Chancellor to think again.

 

The news comes as a leak of an internal government document admits that the delays to the high-speed railway will increase costs, appearing to undermine ministers’ claims.

Leak

The document, seen by the Guardian, says the decision to delay the project is also likely to cost jobs, put construction firms at risk of going into administration and says the department could face compensation claims.

Parts of the HS2 line between Birmingham, Crewe and Manchester will be “rephased” by two years, meaning the line to Crewe may not be open until 2036, and Manchester not until 2043. Under the last announced schedule, London-Manchester trains were due to start to run sometime between 2035 and 2041. It also raises the prospect of trains terminating at an outer London station, Old Oak Common, for almost a decade before trains arrive at Euston.

 

CICES says delays to the northern stretch will cause a major decline in confidence in the rail and infrastructure sectors, impact jobs and livelihoods and businesses in the Midlands, will make it difficult to attract talent and dissuade young people from taking up careers in infrastructure.

 

Simon Hamlyn, CEO at the Chartered Institution of Civil Engineering Surveyors (CICES), said: “The government talks about levelling-up but when it comes to the crunch it’s always the north which loses out. We need long-term thinking and investment now, not short-term decision making and delays which will have a long-term effect on jobs, livelihoods, businesses and young people’s careers.”

 

“Saving money now on the northern part of HS2 makes no economic sense since costs will rise further down the line.”

 

“We are hugely disappointed by the government’s decision and would urge an eleventh-hour rethink. The Chancellor still has time to reverse this decision when he stands up in the Commons to deliver today’s Budget statement.”

 

Stephen Slessor, Immediate Past President of CICES, said: “The HS2 network should have linked eight out of ten of the UK’s largest cities, providing employment opportunities and boosting the economy while reducing road emissions and traffic congestion. This delay will negatively impact investor and contractor confidence in the rail sector and infrastructure sectors and inevitably jobs and livelihoods for many people and SMEs in the Midlands.”

 

“It is important to avoid delays in large sections of HS2 despite current inflationary pressures as this would increase overall costs and hinder the UK’s transition to a more sustainable economy while putting in jeopardy Net Zero targets.”

 

“The UK Government should tackle these issues head-on and focus on driving revenues rather than just reducing costs, to close the financial gap and reduce the railway’s reliance on taxpayer funding. In my view, investing in large-scale infrastructure projects like HS2 is necessary for the UK’s long-term economic growth and environmental sustainability.”

 

Alison Watson MBE, Vice President of CICES, said: “This delay to HS2 is likely to have a significant impact on young people entering the sector, especially those who are encouraged to seek apprenticeships in infrastructure, not to mention that it is likely to undermine careers advice in general.”

 

“Given the annual rhetoric about the thousands of people who are needed to ‘join the construction sector to meet demand’, it hardly gives young people confidence that our industry is reliably going to offer employment – and only adds to the ‘north-south divide’.”

 

The Guardian document admits there will be “some impacts on jobs and HS2 Ltd will need to consider how best to progress the various phases of the programme”. It says “additional costs will be created by deferring expenditure on the programme.”

 

According to the newspaper report, the document’s Q&A format, asks: “What will the government do about construction companies that go bust because of this announcement?”The document says companies will have to “work through the contractual consequences of this announcement.”

 

The document says the Manchester leg may not be completed until 2041, with “Euston delivered alongside high-speed infrastructure to Manchester”. Construction at Euston will not be continued “for the next two years… with the site made safe and maintained until construction works continue.” It says design teams on the site will be demobilised.

 

The Q&A asks: “Is the government breaking its promise of trains going to Stafford, Stoke-on-Trent or Macclesfield?” The department does not offer a guarantee, saying only “that it is continuing to work through the implications of this funding settlement.”

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