HS2: Costs for London Euston section reach over £7.5bn
Costs for the London Euston section of High Speed Two (HS2) have risen to more than £7.5bn, according to confidential government documents shared with the Financial Times.
The National Audit Office (NAO) in 2023 nearly doubled its cost projection for the new station to £4.8bn.
Yet a Department for Transport (DfT) paper, marked “official – sensitive: commercial,” paints a more full picture of how much will need to be drummed up.
The new estimate suggests the price tag for covering the new HS2 station and necessary tunnelling will be £6bn.
That, coupled with a later NAO projection that an additional £1.5bn would be needed to rebuild the existing Euston station next door, takes the total cost to £7.5bn.
Given the DfT’s estimate is based on 2019 prices, the actual amount will be closer to £9.4bn, according to Financial Times’ calculations.
The government confirmed in the Autumn Budget that HS2 would terminate at Euston station, following a political kerfuffle over how to find the necessary funding.
The entire project has faced persistent uncertainty since the former Conservative administration cancelled the Northern leg of the route to Manchester last October.
HS2’s current cost is estimated at £67bn but will likely be revised upwards in the coming months. HS2 Ltd, the government body overseeing the project, has put the total cost estimate at £74bn.
When Rishi Sunak axed the Northern leg, the government gave the green light to Euston’s redevelopment, unveiling a new public-private partnership which was estimated to save taxpayers as much as £6.5bn.
The DfT documents contradict that claim, according to the FT, suggesting the partnership would in fact produce savings of between £1.4bn and £2bn.
One government figure described the former administration’s claims as “pretty wild, it was hard to find anyone who believed that at the time.”
A Department for Transport spokesperson said: “Taking HS2 to Euston is a key part of realising HS2’s contribution to national economic growth, which is why this government confirmed funding for tunnelling from Old Oak Common to Euston in the Autumn Budget.
“Ensuring HS2 trains terminate in central London will also catalyse private investment into the station and local area.
“We are working at pace to explore a range of options for Euston, including funding, and we will set out further details in due course.”