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Select Committee · Public Accounts Committee

HS2 Euston

Status: Closed Opened: 15 Feb 2023 Closed: 24 Sep 2023 13 recommendations 14 conclusions 1 report

The Committee will question Dame Bernadette Kelly, Permanent Secretary at the Department for Transport and Mark Thurston, Chief Executive of HS2 Ltd on progress with the design and development of a new HS2 station at Euston. Questions will include how the risks to value for money are being managed, integration with other developments including the …

Clear

Reports

1 report
Title HC No. Published Items Response
Sixty-Third Report - HS2 Euston HC 1004 7 Jul 2023 27 Responded

Recommendations & Conclusions

5 items
1 Conclusion Sixty-Third Report - HS2 Euston Deferred

Existing HS2 Euston report was late and lacked sufficient cost information

Why the existing report was late and contained so little information

Government response. The government deflected from explaining why the past report was late and lacked information, instead detailing the future Euston Reset Programme's ambition to confirm an affordable and deliverable scheme by April 2025.
HM Treasury
9 Conclusion Sixty-Third Report - HS2 Euston Deferred

Initial HS2 Euston station budget was a 'stretch target' and significantly underestimated costs

In April 2020, as part of the overall Phase One budget of £44.6 billion set by the Department, HS2 Ltd planned to design and build the HS2 Euston station for £2.6 billion. This budget was lower than its £3 billion assessment of what the station would actually cost to build.16 …

Government response. The government agrees with the observation and has launched the Euston Reset Programme, aiming to ensure an affordable HS2 station design and establish a realistic budget range and new delivery date in due course, with a target implementation date of …
HM Treasury
15 Recommendation Sixty-Third Report - HS2 Euston Deferred

Local communities impacted by HS2 pause, seeking transparency and input on interim solutions.

We heard concerns from the London Borough of Camden and Drummond Street Traders, who already face many years of disruption, and impact of the pause in construction on local residents and businesses and be absolutely transparent when it is possible to do so on what the revised timetable involves.35 We …

Government response. The government agrees with the recommendation to address concerns and be transparent, and has commenced the Euston Reset Programme to develop an affordable and deliverable Euston campus by April 2025, deferring transparency on the revised timetable until after this programme.
HM Treasury
16 Conclusion Sixty-Third Report - HS2 Euston Deferred

Significant inflationary pressures led Department to pause HS2 and road building projects.

The Department is having to manage significant inflationary cost pressures across its spending on major infrastructure projects, particularly from higher costs of construction materials.37 For example when we examined progress on the HS2 programme in May 2022, HS2 Ltd told us that it was seeing ‘30% to 40% swings in …

Government response. The government agrees with the observation and states that while departments must absorb inflation, they are discussing with HM Treasury how to manage future HS2 cost pressures to protect value for money, and will report back in six months.
HM Treasury
17 Conclusion Sixty-Third Report - HS2 Euston Deferred

Department discusses HS2 inflation management with Treasury, recognising mid-year cuts' poor value.

The Department told us that, although budgets are now set, it continues to have discussions with HM Treasury about how it manages inflation on programmes like HS2 in order to deal with any issues that may arise later in the year. The Department also acknowledged the value for money implications …

Government response. The government agrees with the observation and states that while departments must absorb inflation, they are discussing with HM Treasury how to manage future HS2 cost pressures to protect value for money, and will report back in six months.
HM Treasury

Oral evidence sessions

1 session
Date Witnesses
24 Apr 2023 Alan Over · Department for Transport, Dame Bernadette Kelly DCB · Department for Transport, Mark Thurston · HS2 Ltd View ↗

Correspondence

1 letter
DateDirectionTitle
15 May 2023 — Correspondence from Dame Bernadette Kelly DCB, Permanent Secretary, Department …