Industry ‘disappointed’ and ‘disheartened’ over axing of HS2’s northern leg

Industry has expressed huge disappointment at the scrapping of HS2’s northern leg to Manchester. 

Prime Minister Rishi Sunak has announced the high-speed rail link between Birmingham and Manchester will no longer be delivered – but £36bn will now be invested in other transport projects across the country.

Sunak’s long-awaited announcement came as he said HS2 had seen costs spiral and had been repeatedly delayed – with forecasts predicting a line to Manchester wouldn’t open until 2041.

The Association for Consultancy and Engineering (ACE) said the concept of "Network North" was welcome - but cautioned the devil will be in the detail.

Stephen Marcos Jones, chief executive of ACE Group, said: “There is a great deal of disappointment amongst our members and there remains much uncertainty about the Prime Minister’s ‘Network North’ announcement and the detail behind it. Construction needs certainty of pipeline to deliver the Government’s infrastructure projects and this situation has not helped.

“I urge the Government to ensure the highly skilled jobs that would have been created are not forgotten when it comes to delivering ‘Network North’ – no matter what form this takes.

"The emphasis must now be on ensuring the projects the Prime Minster announced in his speech are delivered on time and on budget, minimising the impact on the organisations currently working on HS2.

"What we now need is a commitment and a long-term strategy to restore faith and credibility in the UK’s ability to deliver ambitious infrastructure projects, attracting long-term investment and delivering prosperity to every corner of the nation.” 

Sir John Peace, chairman of Midlands Connect, said the transport body was “disappointed and disheartened” by the HS2 announcement.

“We must not start from scratch,” he said, “we must work at pace to deliver HS2 Phase 1 all the way to Euston. There are also lessons to be learnt from the HS2 story so far.

“The Midlands Rail Hub and road programmes including the A5 which have been announced today resonate with us, these are our transformational east-west priorities for the region, which we recommended and have been progressing with government.

“We are now calling for more detail on timescales and plan of action, and asking for a high-level urgent meeting with ministers, to ensure these plans and the benefits for the Midlands are delivered as quickly as possible.”

Lord McLoughlin, chair of Transport for the North, said: “The cancelling of the northern leg of HS2 is naturally disappointing. 

“It’s undeniable that this will be seen by many as a missed opportunity for the region, and the country as a whole. Only last week, northern business and political leaders came together at our TfN Board to speak with ‘one voice’ to reaffirm our position that HS2 and NPR in full are vital to truly transform the North.

“The announcement of investment in the region is obviously welcome. And we will look to work with government to fully understand the implications for the North of the proposals set out today.”

Darren Caplan, Railway Industry Association chief executive, said many RIA members would be “extremely disappointed” by the announcement. 

“Scrapping HS2 Phase 2 is simply unnecessary and squanders the full benefits of Phase 1,” he said. “The government can work with metro mayors, the railway industry, rail suppliers, and other stakeholders, to agree a cost-effective way forward, including encouraging private investment to take pressure off the public purse.

“Today’s nuclear option is defeatist and sends a terrible signal to potential overseas investors that the UK simply cannot deliver large national transport infrastructure schemes. 

“For companies with existing contracts, the implications of the Prime Minister’s proposal to release £6.5bn from the Euston site and create a development zone are particularly unclear. 

“Already, multinational railway businesses will be making plans to rationalise their workforces and investments in a way that will be detrimental to the country’s rail supply sector specifically and UK plc more widely. 

“This also blows a hole in the Government’s levelling up and decarbonisation agendas – none of the replacement regional schemes referred to will have the same impact of building the HS2 in full.”

He added government needs to safeguard the full HS2 route for future generations, and pass the relevant bill in the King’s Speech next month.

Philippa Spence, UK managing director of Ramboll, said: “The axing of the northern leg of HS2 is a devastating blow. 

“Major capital projects like HS2 have an incredible economic multiplier effect which enables skills growth and world-leading innovation in technology and construction techniques. 

“When such projects are cut, there is a ripple effect on jobs and growth through many sectors. 

“We haven't seen the likes of anything as significant as the recent infrastructure rollback the government is leading for a long time, so will the replacement Network North deliver the growth we need?” 

“The scale of the pause or reversal on major infrastructure projects such as the northern leg of HS2 has a ripple effect on skills.

“Companies in the construction sector who are reliant on it will suffer as a result. The ability to bring in early career staff, be they graduates or apprentices, gets curtailed and that then has knock-on effects that can roll forward for decades.” 

Jason Prince, director of the Urban Transport Group - UK’s network of city region transport authorities - said: “Many of our member city regions have designed local transport schemes around the promise of larger infrastructure projects, whether HS2 or otherwise. 

“Our members need the confidence that once schemes are announced, they are delivered. The same logic applies to the raft of transport projects unveiled by the Prime Minister today.

“Fundamentally, transport is about more than simply moving people from A to B. It is about creating economic growth and thriving communities for people to live and work in. This can only happen through certainty of long-term investment.”

Pamela Chesterman, planning partner of law firm Irwin Mitchell, said: “The pledge for Levelling Up continues to be pushed to one side.

“One of the key arguments in favour of HS2 was that it would improve transport links between the North and South of England, making it easier and faster for people to travel and do business. 

“However, even with HS2, journey times between London and Manchester would still be around an hour and a half. I cannot argue that continuing to spend billions on a scheme that has potential to cut travel times by 30mins does seem ludicrous during the various crises we are all enduring, but this is the spin the government is now giving it. 

“The reduction in travel time is one very obvious bonus, but had it delivered what it set out to, then the benefits would have also included longevity in stock and infrastructure, environmental enhancements and safer stations and connectivity for all users.”

Andrew Baldwin, head of policy and public affairs at the Association for Project Management (APM), said:  “Sadly, this project has been plagued with uncertainty since the outset and the original scope has been changed multiple times. 

“Major projects of this nature need political and economic stability to work – investors need to trust that their investment will be worthwhile.

“Ultimately, you can fix projects by rescoping and reassessing; you can’t fix them by scrapping them. There was a need for HS2, and that need remains, irrespective of the other projects mentioned in the speech. 

“We are of course pleased to see this money will be retained to use on other major transport projects and look forward to concrete proposals on those, particularly Network North. 

“But we had a concrete plan to deliver a major project that would have improved capacity between Manchester, Birmingham and London. We now have uncertainty, speculation and a list of projects that may or may not get spades in the ground before the next general election.”

Paul Hamer, CEO of construction and civil engineering company Sir Robert McAlpine, said: “If we hope to build affordable infrastructure that offers value to the UK and stimulates economic and social growth, we need to take a longer-term view on infrastructure investment. 

“With HS2 prized as the UK’s flagship levelling up project, it’s disappointing that the economic and political climate has deterred this ambitious project to improve and rebalance the overall economic health of the country from inception to completion.

“Infrastructure is one of the key pillars of economic longevity and improvement. Whilst it is promising for industry and the country to see the alternative infrastructure investments proposed, proposals must now be accompanied by robust delivery plans to ensure intentions are viable and we are still building towards a better future, rather than taking a step back.”

Chris Richards, director of policy at the Institution of Civil Engineers (ICE), said: “The lesson from today’s announcement on HS2 is the UK must change how it approaches planning and delivering infrastructure.

“The stop/start approach the country takes to major infrastructure benefits no one. We need long-term plans, supported by evidence, long-term thinking on financing options, and robust and consistent policy to achieve desired outcomes.

“The Prime Minister outlined several projects and schemes in his speech. Many of these projects aren’t new, and many have been previously caught in this stop/start cycle of decision-making, which drives up costs. This is likely to happen again.

“Changing direction and switching projects delays businesses and communities from benefitting from infrastructure investment. These positive outcomes are how we should be measuring success, not just by lowest cost to deliver.

“The National Infrastructure Commission will publish its second National Infrastructure Assessment in a few weeks. Before politicians rush off to make the same mistakes again on infrastructure, they should pause, look at the commission's advice and use this as a long-term plan to prioritise investment and rebuild credibility.”

Danny Hope, regional director – North West at multidisciplinary engineering design consultancy Hydrock, said: “HS2 was more than just a railway line. It was a symbol of hope and opportunity for the North. 

“A chance to level up the playing field and close the economic gap with the south — something the Conservatives promised to achieve during their 2019 election campaign.

“Now, that chance feels lost. Unless the North is bailed out through a combination of local authority and private sector investment, we’ve been left behind once again. 

“We were given hope with talks of levelling up, but in hindsight we've been blinded by hollow Whitehall rhetoric. The government’s chopping and changing with policies like Levelling Up and Investment Zones have ultimately become muddled, ineffective and now, axed. 

“It's a betrayal of everything that the government promised the North. It's a betrayal of our people and our future.”

Zoë Billingham, director of IPPR North, said: “The government has played fast and loose with HS2 and scrapping the Manchester leg is a betrayal of the North. 

“Transport is the backbone of rebalancing our regions. New promises heard today to redeploy HS2 funding – across the whole country – not only undermines levelling up but also lacks credibility.  

“Northern Powerhouse Rail and HS2 are in the long-term interest of the country. This is a double blow for the North.” 

Allan Wilen, economic director at construction market intelligence experts Glenigan, said: “Cancelling HS2 phase 2 is a lost opportunity to deliver a long-term boost to economic growth and productivity both in the North West of England and across the UK. 

“The new line would have not only reduced journey time for passengers, but freed-up capacity on the existing for more local and freight services. This would also have indirectly reduced congestion and delays on the motorway network.

“The decision will also be a blow to many contractors and subcontractors and material manufacturers who have already invested significantly to deliver this project, during a time of extremely tight margins. In a sector already struggling to re-establish itself following an extraordinary few years, this does nothing to build stability and certainly across the construction sector.” 

Tim Seal, head of construction at law firm Ridgemont, said: “Today’s decision removes a big piece of work for the construction industry and will be a source of disappointment and uncertainty for many businesses that were gearing up for Phase 2 of HS2. This is particularly the case for companies that have already landed contracts for Phase 2. 

“They will need to scrutinise their agreements to see where they stand from a legal perspective. In particular what does the termination clause say about terminating the contract where the government shelves the project?  It may well have been drafted to limit or exclude the contractor from having a right of recourse, which would make it difficult for affected businesses to dispute the termination of their HS2 contracts.”

However, the list of new transport projects has brought some praise. Investment in the East Anglia area includes remodelling of the Ely North and Haughley Junctions.

England’s Economic Heartland and Transport East said: “This has been a longstanding top priority for both England’s Economic Heartland and Transport East and the collective voice of our partnerships has been the reason why the government has prioritised investment in Ely and Haughley rail junctions over so many other investment needs.

“As our Keeping Trade on Track Brochure demonstrates there is unprecedented support from businesses, local authorities, and the rail industry right across the country for investment in this crucial corridor.” 

Dr David Crosthwaite, chief economist at the Building Cost Information Service said:

“The cancellation of the HS2 link to Manchester is a sad indictment of the government’s ability to plan and deliver major investment, which can only damage our reputation with investors at home and abroad. 

“It would be interesting to know how much time and money has been wasted in reviews and audits. The way to deliver a major infrastructure project or indeed any project is to plan first and build fast.

“It is difficult to take positives from this decision and while many of the proposed alternative uses of the money are welcome, what guarantee do we have that they will ever be delivered?”

Click here to read more about today’s transport announcement by the Prime Minister.

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