HS2 will need to spend £100m and take three years closing down sites for the cancelled Phase 2 leg despite construction never starting on them.
The costs are revealed in a National Audit Office report into the response to last October’s decision by former Prime Minister Rishi Sunak to can Phase 2 connecting Birmingham with Leeds and Manchester.
The report states: “HS2 Ltd needs to efficiently and safely decommission and close down Phase 2 construction sites.
“Although no substantive construction work had begun on Phase 2 before it was cancelled, HS2 Ltd had begun early enabling works including investigative boreholes and moving utilities such as gas pipes.
“HS2 Ltd has an obligation to reinstate land to its original state or, for land where environmental works have been completed, to maintain the land until disposal.
“HS2 Ltd expects to complete remediation works for Phase 2 by summer 2027 at an estimated cost of up to £100 million.”
The report reveals that HS2 has also spent £592m on buying land and 1,000 properties along the route it will no longer need.
On rising construction costs on Phase 1 of the project it said: “In September 2023, HS2 Ltd estimated that the forecast cost of main civil construction work alone had increased by £6 billion (2019 prices) since 2020.
“Although these works are on schedule, HS2 Ltd has not driven the cost performance it expected through its contracts, and contractual incentives to control costs and improve productivity have not worked as intended.”
It added that HS2 is now looking to “renegotiate its four main construction contracts to better incentivise cost control and achieve greater certainty on costs.”
“However, DfT and HS2 Ltd acknowledge that successfully renegotiating major contracts that are already in progress will not be straightforward.”
