Source · Select Committees · Public Accounts Committee
Recommendation 24
24
Acknowledged
Recurring departmental failures in budgeting, cost estimation, and integration across major rail programmes
Conclusion
The Department’s failures around budgeting, cost estimation and integration on the Euston project are not new. We have reported on these as part of our examination of other major rail programmes over the years. For example, on the Thameslink Programme, this committee found in 2018 that Network Rail did not have enough contingency within its budget for the redevelopment of London Bridge station, where costs rose from the condition and complexity of the site.60 This committee also reported about the Department’s failure to manage the modernisation of the Great Western Railway in 2017 in a joined-up way, including a failure to integrate projects together.61
Government Response Summary
The government acknowledged the committee's observation about past failures, stating it fosters a strong culture of learning lessons from major rail programmes and is applying them across HS2, including specific initiatives and sharing insights with less mature projects.
Government Response
Acknowledged
HM Government
Acknowledged
6.1 The government agrees with the Committee’s recommendation. Target implementation date: Summer 2025 6.2 The department has a strong culture of learning lessons from managing major rail programmes, which includes working with the Infrastructure and Projects Authority in order to learn lessons from Crossrail. The department made the decision not to proceed to full construction of Euston Station in the next two years due to affordability and profiling issues. It will continue to apply lessons learnt across phases of the HS2 programme. 6.3 A culture of lessons learned is actively encouraged within the department, and specific initiatives are promoted in the individual directorates running each part of the HS2 project, including a structured learning and development programme, peer-to-peer learning, mentoring, and shadowing and facilitated workshops. 6.4 As part of the Euston Reset Programme, the department is working to identify the cost drivers of the previous station cost estimate of £4.8 billion. High Speed Rail Group is learning from the more mature elements of the HS2 programme, including those from Birmingham Curzon Street and other major projects in the department's portfolio. These are being actively shared with projects that are less mature. 6.5 HS2 Ltd are undertaking work in order to understand the key cost drivers of the current station design and the reasons why the station cost increased following the move to a 10-platform single-stage build design in 2021. The department is also keen to understand appropriate lessons to enact as part of the Euston Reset Programme. Learning, both within the department and at HS2 Ltd will be shared with colleagues developing Manchester Piccadilly and Birmingham Curzon Street stations. 6.6 The department is working with delivery partners to complete the optioneering stage of the Euston Reset Programme. Once appropriate options have been identified, the department will undertake a sift process in which only solutions that are deliverable cross-campus will be considered.