After more than eight years of planning for the HS2 London-Birmingham high-speed railroad, the U.K. Dept. for Transport "still does not know what it is trying to achieve with the...station at Euston," claims a new report by lawmakers.
A two-year pause of work ordered by the Dept. for Transport (DfT) this March at the "floundering" $6.1-billion London terminal will have uncertain impacts on the supply chain, overall program costs and local communities, the Public Accounts Committee reported.
Aimed at saving money, the pause "is not cost free," says Meg Hillier, the committee chair. The project's "wildly unrealistic" $3.3-billion budget was set in April 2020 "in the expectation that it would be revised," she alleges.
Calling on the government not to repeat the same mistakes, Hillier says the experience so far showed that "forging ahead over-optimistically in an unclear direction is clearly not the right approach.”
Asked why the April 2020 budget was set $510 million below estimates at the time, the project company HS2 Ltd. (HS2L) told the committee that there was much uncertainty around exactly what the station and all the surrounding area would entail. Independent advisers had found the budget was "a stretch target," added DfT.
The station was planned in 2015 with 11 platforms. By June 2020 the cost forecast had escalated to $5.6 billion. Following a review, the size was reduced to 10 platforms to be built in one rather than two phases. But by this March, even the 10-platform option was forecast at $6.1 billion.
The DfT attributes some of the cost hike to incorporating requirements from all stakeholders, including Transport for London, the Greater London Authority and the London Borough of Camden. HS2L stressed that the project would be a major transportation hub with 5.4 million sq ft of commercial development.
The cost of the pause itself would not be known until it was clear how much of the original designs could be incorporated in the final project, DfT told the committee. However, the government expects the $2.6 billion already spent around Euston would not be wasted.
But because the existing designs are no longer suitable, the HS2L wrote off $135 million of work in its fiscal year 2021 accounts, the committee reported.
Around $255 million will be spent shutting down Euston works and securing the site, according to HS2L. Contractors were not lodging compensation claims because of the shutdown, the company noted.