HS2: Sunday Times Investigation
The Sunday Times approached me in late September to contribute to their investigation into HS2. The journalists have done excellent work in communicating the essence of a complex story. They were also very thorough, I logged 11 hours of phone conversations, a half day meeting plus emails and other documentation. Contrast this with circa one hour meetings with the HS2 Fraud Team and the Government Internal Audit Agency.
Between the time I agreed to contribute and the time of publication the decision was made to cancel the northern part of HS2. The cause for concern now is that the Government has replaced HS2 Phase 2 with plans for £36bn (thirty six thousand million pounds) of spending on ‘Network North’. There is also still £20bn or more (twenty thousand million pounds) of spend remaining on HS2 Phase 1. Embarking on a such massive spending before addressing the obvious governance problems is an unnecessary and extreme risk.
On 14th September The Independent published an article Rishi Sunak and Jeremy Hunt in talks to scrap phase two of HS2 as costs spiral | The Independent. The article stated that the Chancellor and PM were contemplating whether or not to cancel Phase 2 of HS2 and that ‘talks are ongoing’.
The article featured a photograph from the politicalpics X account of a person carrying a document which included a ‘Savings Table’. The document title is ‘CX-PM bilat Redwood table’, referring to a Chancellor of Exchequer & PM bilateral meeting. The Independent state in another article that ‘Project Redwood’ is the name of an exercise to consider cancellation of Phase 2 of HS2. Given the context of the article; I judge it highly likely that the table contained the costs being presented to the PM and Chancellor as supporting information on how to proceed with HS2. Of course, we cannot know the full context of the discussions that have taken place, or what the PM and CX thought of the numbers they were given. According to politicalpics the person holding the document is accompanied by James Bowler, Permanent Secretary, HM Treasury. Coming from such a source, it is reasonable to think that the PM and Chancellor would believe the numbers given to them were credible.
In the cost savings table the costs of Phase 2a are given as ‘Central Estimate’ £5.8bn (five thousand eight hundred million pounds) and ‘Pessimistic’ estimate of £7.2bn (seven thousand two hundred million pounds). The note in the table states ‘Central estimate taken from IRP work’. IRP being the Integrated Rail Plan which was published in November 2021.
As explained in the Sunday Times article in late 2021 I worked on the HS2 Phase 2a cost forecast with responsibility for computing the risk costs. The result of the analysis was an Estimate at Completion (comparable to a ‘Central Estimate’) just below £7.2bn. This compares with the ‘Central Estimate’ given in the photographed table of £5.8bn. I cannot see why outdated numbers from the IRP would be presented when the more recent numbers were available. We need to be told the truth of what was presented by Treasury to the PM & CX.