A revised business case for completing Phase 1 of HS2 will not be ready before next year, the Department for Transport has warned.

The project’s recently-appointed chief executive Mark Wild had previously conceded that ‘the programme is in a very serious situation that requires a fundamental reset to enable it to be delivered to the lowest feasible cost’.

In a letter to the chairman of the Public Accounts Committee Sir Geoffrey Clifton-Brown, DfT permanent secretary Dame Bernadette Kelly says the new business case for the London-Birmingham section will not be available until ‘early 2026’. She continues: ‘Officials and HS2 Ltd have prepared plans to remediate the works started on the former Phase 2a section and part of 2b, subject to decisions on the overall policy approach. Therefore, while this work is ongoing, the Department has been unable to meet the Spring 2024 target implementation date.’

In its latest report, the Committee had said the problems of delay and cost overruns on HS2 were risking damage to the country’s reputation. Sir Geoffrey had commented: ‘We are sceptical of Government’s ability to successfully deliver even a curtailed scheme, one which we already know will on its face bring very poor value for money. The question has instead become: what possible benefit can the Government now salvage for the taxpayer?’

The Committee had reported that the cost of HS2 is now expected to be ‘close to £80 billion’,  continuing that it was ‘not convinced that DfT has sufficiently considered how it can bring fresh thinking to its own leadership of HS2, or whether it has the right skills and capabilitie to lead the programme effectively and credibly’.

Ms Kelly’s letter is dated 27 February but has only now been published.

She says: ‘Before producing an updated business case, the programme needs to be reset and the Secretary of State has tasked the new Chief Executive of HS2 Ltd, Mark Wild, to review the remaining scope, the cost and schedule needed to complete phase 1 and advise the government on what is required. The department is planning to publish an updated programme business case in early 2026 after an agreed cost estimate is produced following the programme reset. The updated programme business case will include information related to the benefits realisation and evaluation.’

Ms Kelly adds ‘HS2 Ltd is also continuing to work with the principal suppliers to ensure focus on the cost-effective delivery of the remainder of the civil works. The Department will provide an update on that work in forthcoming reports to Parliament, subject to commercially sensitive details.’

She concludes: ‘Throughout 2024, HS2 Ltd undertook a comprehensive change programme to reshape the organisation to deliver the revised programme. However as mentioned above the department has commissioned Mark Wild to undertake a comprehensive review of the project, including capability. The outcome of this review may result in further changes, which the Department will provide details on in any subsequent parliamentary reports.’

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