Cost of building HS2 railway station at London Euston soars to £4.8bn

Cost of building HS2 railway station at London Euston soars to nearly double at £4.8BN… and it will be 16 years late

• Construction of 10-platform London terminus was budgeted at £2.6bn in 2020
• But this has soared by £2.2bn to £4.8bn – and Euston HS2 is set to open in 2041 

The estimated cost of the troubled new High Speed Two railway station at London Euston has nearly doubled in three years to £4.8billion, a report found today.

Construction of the 10-platform London terminus was budgeted by HS2 Ltd at £2.6billion as recently as April 2020, but this has now soared by £2.2billion.

An original two-part design was paused in 2020, before it was redesigned in October 2021 for Euston to have ten platforms instead of 11 and be built in one stage only.

But the National Audit Office has now concluded that ‘the 2020 reset of the station design has not succeeded’, adding that recent high inflation has also caused issues.

It comes after Michael Gove yesterday refused to guarantee HS2 will terminate at Euston, saying he did not know where the final London destination would be.

The Levelling-Up Secretary said there was a ‘debate’ about whether it should be Euston or Old Oak Common, a new £1.7billion 14-platform station planned for Acton.

The line is set to cut London-Birmingham journeys to 52 minutes, but HS2 is now not set to get to Euston until 2041 at the earliest, having initially been planned for 2026.

Some £1.5billion has already been spent on land purchases and preparatory works for Euston and its approaches. The overall HS2 project is estimated at £100billion. 

HS2’s current official budget is £44.6billion for Phase One (London to Birmingham), £7.2billion for 2a (Birmingham to Crewe) and TBC for 2b (Crewe to Manchester). 

The delays are now far more serious than those to Crossrail, which was initially set to open in 2017 – but will finally start a full service in May and is £4billion over budget. 

An aerial view of the HS2 London Euston station construction site, pictured in August last year

An artist’s impression from HS2 of the interior of the new Euston Station, looking to the south

A computer-generated image issued by HS2 of the exterior of HS2 Euston railway station

The NAO said today that delays linking up HS2 and Euston will mean extra costs and potentially even higher spending.

READ MORE – HS2 will be like the ‘Ryanair of the rails’ – shall we just scrap it? 

A near 50-page report, looking specifically at the Euston element of the much delayed high-speed line, concluded that a ‘reset’ in 2020 had ‘not succeeded’.

The Government announced earlier this month that it will prioritise having initial HS2 services running by 2033 between Old Oak Common and Birmingham Curzon Street as part of measures designed to cut costs.

The Government also announced that the construction of the Birmingham to Crewe leg of HS2 would be delayed by two years.

Presented as cost-saving measures amid high inflation, the changes are set to see services not stopping in Euston for years to come, with passengers expected instead travel for half an hour on the Elizabeth line.

But the NAO warned while the postponement may allow the Department of Transport to move the Euston end of the project to a ‘more stable footing’, ‘the deferral of spending to manage inflationary pressures will lead to additional costs and potentially to higher spend overall for the project that will need to be managed closely’.

It said that latest estimate by HS2 Ltd set the cost for the 10-platform design at Euston at £4.8billion.

A map shows the planned route for High Speed Two which is split into a series of phases

This graph shows how the cost estimate for the HS2 Euston station has changed since 2020

Plans for the Euston site and the approach route for High Speed Two are shown in this map

‘A successful reset will need DfT and HS2 Ltd to have a clear understanding of the costs, risks and benefits of their chosen design for the HS2 station within the wider Euston programme, supported by a realistic budget, clear and effective governance and integration arrangements, and long-term certainty on the scope of the project,’ the report warned.

READ MORE – Ghost towns of HS2: The homes abandoned and the locals left in limbo over line that may never reach them 

The NAO said that it has not yet been show that ‘the conditions are in place to secure value for money’.

The report found that by the end of December 2022, HS2 Ltd had spent more than £2 billion on the HS2 Euston station and its approaches, covering design, land and preparation works.

Gareth Davies, the head of the NAO said: ‘Government is once again having to revise plans for Euston HS2. Clearly, the 2020 reset of the station design has not succeeded.

‘DfT and HS2 Ltd have not been able to develop an affordable scope that is integrated with other activity at Euston, despite their focus on costs and governance since 2020. Recent high inflation has added to the challenge.

‘The March 2023 announcement by the Transport Secretary pausing new construction work should now give DfT and HS2 Ltd the necessary time to put the HS2 Euston project on a more realistic and stable footing.

‘However, the deferral of spending to manage inflationary pressures will lead to additional costs and potentially a more expensive project overall, and that will need to be managed closely.’

Labour’s Dame Meg Hillier, chairwoman of the Committee of Public Accounts, said: ‘Attempts to reset the High Speed 2 Euston Station have failed.

A computer-generated image of the planned Old Oak Common station in Acton, West London

The £1.7billion Old Oak Common station in Acton has got the go-ahead for permanent works

Construction on the Old Oak Common station in the Acton area of West London has begun

‘It is still unaffordable and no further forward than it was three years ago.’

READ MORE – TfL ring fences £4million in budget for upcoming financial year to name each individual London Overground line 

 

She said that the report shows ‘that the redesigned station would have cost nearly double what was budgeted. The delays to fix this will be felt not only by the taxpayer, but will continue to disrupt people and businesses around Euston.

‘Department for Transport and High Speed Two Ltd have wasted enough time and money. They must get Euston right next time or risk squandering what benefits remain.’

On Sunday, Levelling Up Secretary Michael Gove refused to guarantee that HS2 will terminate at Euston.

The senior Conservative, asked on Channel 4’s The Andrew Neil Show whether he could guarantee the train route would end in central London, said: ‘There is a debate about whether or not it should be Old Oak Common or Euston.

‘Old Oak Common is going to be a major area for regeneration but we want to make sure as many people as possible can benefit not just from the additional rail infrastructure but also from the regeneration that HS2 can bring.

‘So the Old Oak Common area is a part of north-west London that requires levelling-up.’

Pressed on whether HS2 would go to Euston, the Cabinet minister replied: ‘I don’t know what the final decision will be about where the terminus will be.’

An aerial view of the HS2 vent shaft works at Amersham in Buckinghamshire in February

One of the two Tunnel Boring Machines run by HS2 Ltd at Ruislip in West London last October

The tunnel entrances at the HS2 south portal site at West Hyde in Hertfordshire in 2021

Reports surfaced in January that the Euston element of the high-speed line might never be completed despite preparatory works having started around the major station.

But Chancellor Jeremy Hunt was quick to attempt to quash such rumours.

Mr Hunt said at the time that he did not see ‘any conceivable circumstances’ in which HS2 would not run to its planned central London terminus at Euston.

Complexities around the Euston site meant high-speed services were already due to temporarily start and end at Old Oak Common, with passengers using the Elizabeth line to travel to and from central London.

A ‘full business case’ for HS2 published by the DfT in April 2020 stated that the target timeframe for services launching between Old Oak Common and Birmingham was 2029-2033, whereas for trains between Euston and north-west England the range was 2031-2036.

Transport Secretary Mark Harper’s announcement earlier this month on prioritising Old Oak Common to Birmingham services was interpreted as meaning that route may not now enter central London until the 2040s.

But Mr Gove’s remarks will cast doubt on whether the Euston connection will ever be given the green signal.

As part of Mr Harper’s announcement, it was also confirmed that the construction of the Birmingham to Crewe leg of HS2 will be pushed back by two years.

Mr Gove said it remained Government policy for the line to be built as far as Manchester in the north of England.

A Department for Transport spokesman said: ‘We remain committed to delivering HS2 from Euston to Manchester in a way that delivers the best value for money to the taxpayer.

‘That’s why we recently announced we will rephase the Euston section of the project to manage inflationary pressures and work on an affordable design for the station.

‘We will carefully consider the recommendations set out by the National Audit Office and will formally respond in due course.’

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