The start of construction for High Speed 2 has been pushed back again as contractors struggle to keep to the £56bn target build cost.
High Speed 2 Ltd has confirmed that it had put back the notice to proceed (NTP) for the main civil works packages until an undisclosed date “later this year”. This is to allow the contractors to cut construction costs further.
The main civils works contracts are divided into two stages, with HS2 Ltd giving the NTP at the end of stage one which focuses on concept/scheme design. During this phase, contractors work with HS2 Ltd to finalise cost estimates ahead of the award of the NTP which triggers the start of construction.
The project has been under mounting pressure to reduce costs with New Civil Engineer revealing in June last year that contractors’ prices were coming in collectively at around £1bn over the target cost.
Later that month HS2 Ltd then revealed that the NTP was being pushed back from February 2019 to June this year to allow contractors to “go away and sharpen their pencils” to cut costs.
However, that date will now be pushed back until later in the year.
HS2 Ltd chief executive Mark Thurston confirmed the “cost pressures” facing the main civils contractors in an exclusive interview in November last year.
The main civils works packages for phase 1 of the line from London to Birmingham are divided into seven packages with contracts estimated to be worth a total of £6.6bn let to contractors in July 2017.
The £56bn total cost of the line was approved by the Treasury in the 2015 Spending Review with £27bn allocated to phase 1 between London and Birmingham and the rest to phases 2 which extends the line to Manchester and Leeds.
A HS2 Ltd spokesperson said “major work” had already been carried out at multiple sites along the route ahead of the main phase 1 construction programme. HS2 said it was continuing to work with contractors to cut costs.
“HS2 already supports more than 7,000 jobs both directly and across our UK-wide supply chain. Work has been carried out on more than 60 sites including major works ongoing at Euston, Old Oak Common and Curzon Street in Birmingham.
“We also continue to negotiate with our main civils contractors and will move to notice to proceed when those negotiations are concluded later this year.”
In a bid to cut costs, HS2 Ltd has been carrying out cost cutting studies to look into streamlining construction costs of some of the major elements of the job. This included a study, which was independently chaired by Aecom engineering director Mark Raiss, which focused on bridges, viaducts, tunnel portals and retaining walls.
A Department for Transprt spokesperson said: “HS2 is happening. The project is already underway with more than 7,000 people and 2,000 businesses working on building what will become the backbone of Britain’s rail network.
“As taxpayers would expect, we constantly assess the best ways to deliver value for public money and ensure we realise the full benefits of HS2.”
It is not known whether the delay to the NTP will impact on the 20206 opening date for phase 1.
Main civil works packages and contractors
S1: Euston Tunnels and Approaches – SCS JV (Skanska/Costain/Strabag) – £740M
S2: Northolt Tunnels - SCS JV (Skanska/Costain/Strabag) – £1.1bn
C1: Chiltern Tunnels and Colne Valley Viaduct - Align JV (Bouygues/Volker Fitzpatrick/Sir Robert McAlpine) £965M
C2: North Portal Chiltern Tunnels to Brackley - CEK JV (Eiffage/Kier) £724M
C3: Brackley to South Portal of Long Itchington Wood Green Tunnel - CEK JV (Eiffage/Kier) £616M
N1: Long Itchington Wood Green Tunnel to Delta Junction and Birmingham Spur – BBV JV (Balfour Beatty/Vinci) £1.3bn
N2: Delta Junction to WCML Tie-In – BBV JV (Balfour Beatty/Vinci) £1.15bn