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Analysis | Where does the line stop for HS2?

HS2 High Speed Rail

High Speed 2 (HS2) chief executive Simon Kirby has resigned. His departure follows that of engineering director Chris Dulake in March this year and, more recently, lead spin doctor Ben Ruse.

With three of the top team now gone, is the project derailing? It also begs the question – what do the recent departees know that we don’t?

Kirby’s departure is timely. In June this year, HS2 invited the industry to bid for around £11bn worth of contracts for phase 1 and it is now waiting on the government to approve the first stage of the Hybrid Bill in a matter of weeks, which would see construction start on the £55.7bn project.

However, the programme faces cost pressures. Phase 1 of the project is currently forecast to cost £27bn, exceeding the available funding by £204M.

In June this year, the National Audit Office (NAO) published its report into whether the Department for Transport (DfT) was managing the HS2 programme effectively. It identified that the estimated cost of phase 2 exceeded available funding by £7bn. And, although a separate review commissioned by the Cabinet Office identified £9bn worth of potential savings, only £2bn of these have been agreed.

The NAO report also identified that HS2 was only 60% confident that phase 1 of the programme would be delivered by 2026. The challenge has been set to increase this confidence to 80%, but to do so without increasing the cost is a tall order for any project.

“HS2 is a large, complex and ambitious programme which is facing cost and time pressures,” said National Audit Office head Amyas Morse. “The unrealistic timetable set for HS2 Ltd by the Department means they are not as ready to deliver as they hoped to be at this point.

“The Department now needs to get the project working to a timescale that is achievable.”

The NAO report was welcomed by HS2, saying that it acknowledged the progress it had made since a similar report was commissioned in 2013. But behind closed doors, have the findings opened a can of worms which it cannot contain?

To date, the government has been behind the project, but as can be demonstrated by the lingering uncertainty over Hinkley Point C until approval was granted this week, it is not clear whether HS2 will emerge victorious from Theresa May’s post Brexit pondering phase.

Who is next? Non-executive director David Higgins’ contract is up in July next year. And although an HS2 spokesperson emphatically told New Civil Engineer that he has no current plans to leave, the question is, will he renew or will he be following his colleagues and abandon this seemingly sinking ship?

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