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Cost of HS2 could rise to £106bn, according to leaked report

A LEAKED copy of the forthcoming Oakervee Review into HS2 is reported to be warning that the costs of the project could rise again, to £106 billion. The original budget still being confirmed by ministers last summer was £55.7 billion, including substantial contingency margins.

The total then rose to around £78 billion in early September when transport secretary Grant Shapps revealed the new figure, which had been calculated by HS2 chairman Allan Cook. Mr Cook also said that the timetable for construction, which included Phase 1 between London and Birmingham opening in 2026, did not appear to be achievable, and he set the dates for a ‘staged opening’ of the London to Birmingham section as 2028 to 2031.

The Financial Times now says it has seen a leaked copy of the Oakervee Review which was commissioned by Boris Johnson. The Review was due to be published late last year, but may have been delayed by the general election.

According to the story in the FT, the Oakervee Review gives ‘lukewarm support’ to the scheme as a whole and recommends that Phase 2 beyond Birmingham should be ‘paused’ while the possibility of replacing HS2 with improved classic lines towards Manchester and Leeds is explored.

Meanwhile, with the project still uncertain, 15 Conservative MPs are continuing to press for the scheme to be abandoned, but co-executive director of policy at the British Chambers of Commerce, Claire Walker, has told the BBC that HS2 must go ahead.

She said: ‘Business communities are united that this project should be delivered in full. There is no project that has been proposed that will go so far in delivering the transformational change to the Northern business communities as this project will.’

Major construction companies are also warning the Prime Minister that scrapping the scheme would cause ‘irreparable damage’ to the construction industry and jeopardise an ‘industrial renaissance’ in the regions.

Just before the weekend, Grant Shapps said a decision about the future of HS2 could be expected ‘very soon’.

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