UK High-Speed Rail Chief Quits After Delay, Cost Details Emerge
Just weeks into his new job, Terry Morgan has resigned as chair of the company building HS2, the U.K.’s multi-billion-dollar high-speed railroad between London and Birmingham, and also has left his equivalent role in running the capital’s troubled Crossrail project.
Named to replace him at HS2 is Allan Cook, former chairman of UK consultant Atkins for seven years before it was acquired by SNC-Lavalin Inc. in 2017, who also was CEO of UK engineering firm Cobham and a former government advisor.
Morgan's departure, rumored in the UK press for days, comes as Crossrail now is likely to cost up to $2.5 billion over budget while the previously announced nine-month delay will be extended to a date that is yet to be fixed. Problems with the new tunnelled line though central London had been played down by the previous project leadership, alleges the city’s mayor Sadiq Khan.
To replace Morgan on that project, sponsors have recruited Tony Meggs. Currently CEO of the government’s Infrastructure and Projects Authority, Meggs was previously head of technology at oil giant BP.
Sponsored jointly by Transport for London and the Dept. for Transport, the new line will link networks on either side of the city with 21 km of new twin tunnels through the center. Due to open this month, officials announced it was running late in August.
'Huge Amount' of Work Remains
Since becoming Crossrail CEO in late November, Mark Wild has found a “huge amount” of work remaining to be done. “This means that I cannot at this stage commit to a [fall] 2019 opening date,” he says.
London Transport Commissioner Mike Brown adds that “only now is the scale of what is yet to be completed becoming clear."
Kahn criticized previous management of the project company Crossrail Ltd. for presenting “a far too optimistic picture” of progress. The mayor says he has ordered publication of minutes of Crossrail directors’ minutes for the last five years “to provide transparency."
Morgan quit days after press stories heralded his imminent dismissal from both jobs.
On HS2, Morgan reported to UK Secretary of State for Transport Chris Grayling, who shares oversight of Crossrail with Transport for London, controlled by Khan
Tension between the city and Morgan became evident in the days before he resigned on Dec. 5. “There’s been some unfortunate comment about who knew what and when,” he said. “I’m very confident that Crossrail behaved properly ... there are plenty of documents that set out exactly what happened and when."
In a pre-emptive move, Morgan told the BBC: “With the sense of disappointment around the performance of Crossrail … it was considered to be too risky for a program like HS2 [for me] to continue in my role as chairman.”
The Aug. 31 announcement that Crossrail, which was set to open this year but now is delayed well into 2019 and much over budget, was a surprise to all observers.
Only a month earlier, a government update had made no mention of delays on the project.
Under a new funding package agreed by the city and the government to cover the cost rise, the Greater London Authority will borrow up to $1.6 billion from the London transport agency, which will itself contribute $126 million in cash.
To cover potential further cost hikes, the agency has secured a $940 million contingency loan from the UK department.
When Crossrail’s budget was approved in 2010, the central tunnelled section of line was priced at $15.7 billion. Another $2.9 billion was allocated for upgrading existing tracks on either side by the national railroad owner, Network Rail.
When the first delay was announced this summer, the government and Transport for London jointly offered an extra $380 million for the central section and the government committed $364 million for Network Rail’s element of work.
Crossrail’s $380 million is included in the new forecast increase of $2 billion to $2.5 billion
Morgan refutes claims by government agencies that they first heard of the delays in late August. He said he told the agencies and Khan on July 26 "that … we could not deliver the program in 2018. I spoke to the mayor exactly along those lines."
In a bid to establish the facts, the Greater London Assembly has sent a summons to Khan and invited Morgan to appear before its Transport Committee to answer questions.
A spokeswoman for Khan says “he is committed to making sure all relevant documents are published and that he is willing to appear before the assembly to answer questions."
Morgan took the lead at Crossrail in 2009. On his appointment to head HS2 in July, Grayling described him as “world class” with “experience and expertise, demonstrated in numerous leading roles including overseeing the ambitious Crossrail project."