The Assassination of HS2 by the Coward Rishi Sunak
The Assassination of HS2 by the Coward Rishi Sunak
Cost creep cripples high-profile high-speed rail projects. But it's not what kills them.
The now-forever “halfway there” high-speed rail project. Featuring Conservative Party MP and Rail Minister Huw Merriman (left). Source: HS2
Usually I let topics I write about marinate for a few weeks, but I feel compelled to rush this piece out following the dramatic and, frankly, unbelievable way the High Speed 2 (HS2) rail project in England was killed this week.
To recap: HS2 is the ambitious High Speed Rail project currently under construction designed to link London in the south of England to Manchester in the north via Birmingham. It has been under heavy scrutiny due to its ballooning costs, approaching £100 billion. This week, at the Conservative Party Conference, Prime Minister Rishi Sunak announced Phase 2 of HS2 — the segment from Birmingham to Manchester — would be cancelled, leaving only the London-Birmingham section for targeted completion.
HS2 was one of the great rail projects under construction in the world, and arguably the most ambitious in the Anglosphere world. It was the transformative infrastructure project in the United Kingdom of the early 21st century, and one ready to bring the island nation on par with its European peers. But Sunak decided to break its spine before gestation was complete, ostensibly under the old Tory banner of fiscal prudence but with the desperation to gather voter goodwill before the upcoming General Election.
I am still racking my head around the long-speculated and yet quick demise of HS2; perhaps I refused to believe the United Kingdom would do something so foolish so suddenly. And I would be lying if I said if this news did not make me reflexively glean over to the high-speed rail project under construction in my home state of California, and wonder if a similar fate awaits it. (I will get into it later) For now, the ruling Democrats in Sacramento have been largely supportive of the still-nascent California High Speed Rail (CAHSR) project. But of course, the Conservatives believed in HS2 — until they didn’t.
One may blame on British NIMBYism, or post-Brexit state dysfunction, but everything Sunak and his Conservatives spoke of HS2 since the Conference have betrayed a total mistrust of any movement to transform Britain’s urban environments. Throughout the Conference, top ministers fully embraced anti-transit, anti-urbanist messages full of dogwhistles, such as the Transport Secretary declaring a war against “15-minute cities” and the Home Secretary pledging British cities will not “be going the way of San Francisco and Seattle.”1 2 Sunak himself started the dogpile before the Conference, calling local decisions to lower speed limits in town centers “a relentless attack on motorists.”3
Information trickling out after the Conference (especially the “Network North” plan, a plan so comically improvised it may well be a Weekend at Bernie’s dress-up of HS2’s still-warm body) has proven Sunak’s HS2 announcement was somehow both premeditated and rushed. The ubiquity of local mayors and Conservative members caught blindsided by the news demonstrates this announcement was never a move seeking consensus but a ploy to score ideological pot shots.
HS2 did have a very major cost issue, and spiraling costs for infrastructure projects — whether it be highways, power grids or high-speed — are a major concern across the Anglosphere. Ballooning cost issues are indeed corrosive to public confidence in future projects and current belief the government can better there a citizen’s physical environments. However, cost issues are mere by-products of a greater issue: the lack of political will. As I have stated in a previous post observing the success of high-speed rail in France and Spain, political will on the national scale expressed through actions in regulations and standardizations and investments in the project, the experts and the processes are the main key power to transform mass transit. Evidence around the world back strong political will is what rids the cost creep.
If Sunak and the Conservatives were ever serious about solving HS2’s cost issues, they would have invested more into HS2: not only in dedicated, stabilizing funding, but also in governmental oversight, in-house expert personnel and a strong commitment to a long-term program to go beyond HS2. But the Conservative Party power brokers of the past 13 years never showed strong interest in such expression of will. Years of half-hearted actions and constant intervention on HS2 is what precipitated the budget ballooning to £100 billion. Peer countries who have not experienced this spiral with their high-speed rail avoid it because they have not forgotten how to govern.
An Autopsy and Desecration
One can argue HS2 was dead long before Phase 2 was cancelled. The original plan called for a Y-shaped HS2 network forking at Birmingham, one west toward Manchester, the other east toward Leeds. In 2021, the eastern leg between Birmingham and Leeds was cancelled by then-Prime Minister Boris Johnson citing rapidly rising cost estimates. The eastern leg of HS2 up to Leeds would have relieved major congestion off two of three main north-south rail spines of Great Britain. The benefits of a Leeds HS2 would have reshaped rail service connecting London and Birmingham in the south to Newcastle further north of England, and Glasgow and Edinburgh in Scotland. Former HS2 Chief Engineer Andrew MacNaughton called the Birmingham-Leeds corridor the “most important part” of the project.4 British rail expert Gareth Dennis wrote to Parliament in 2022 that this “is by far its most critical and transformative section” and without it the HS2 project has been left to “disintegrating its primary purpose”.5
MacNaughton and Dennis’s case is simple: the name of HS2’s game always was capacity release. Unlike the United States, the United Kingdom have a robust intercity rail system with advanced signaling and modernized infrastructure. However, most main lines has been running at full capacity for what the tracks can handle for many years. The main lines have little to no more room to add extra service. HS2 was packaged to bring as much capacity release on the rail network running in the north of England and the Midlands in one move. With HS2 infrastructure providing a separate route for express and long-distance intercity trips (say, Manchester to London in 88 minutes from the current 140), local trains will have more space to run its regional and local services more frequently and reliably.
A map showing the parallel routes HS2 would have provided to three of England’s main north-south rail main lines and relieved major pressure. Source: HS2
As Dennis argues, HS2’s Achilles heel was every rail modernization work worth its salt in England was placed into the shiny HS2 basket. In countries like France or Spain or China, strategic rail planning comes as a dedicated program with many baskets; in the French or Spanish way, HS2 would have been broken up into fragment projects (“London-Birmingham high speed line”, “Euston Station modernization”, etc.) and delivered more piecemeal. But due to United Kingdom’s record of skip-starting massive projects, with no prognostication for when the next big national rail project will come, the urgency to salvage as much off the long to-do list onto HS2 was understandable.6
For those who wonder why name-your-country can build so much high speed rail but not the United Kingdom or United States, my short answer is this: the former has an established system tasked with building big things at all times and the latter do not. The former has dedicated, stable government support; a stable of in-house experts with continuous experience in delivering big public projects; a well-oiled supply chain comprised of firms which are assured of future big project works in the pipeline; and regulations designed to standardize designs, reduce redundancies and smoothen the procurement process. Much of these are recommendations from the Transit Costs Project, a NYU-led study into high infrastructural costs in the United States.7 The work never really stops in France, Spain, Turkey, Italy, Sweden, China, or South Korea. But in the United Kingdom and United States, the work happens maybe once a generation, if lucky.
The United Kingdom likely never had the state capacity to be a responsible steward for HS2, but decisions taken by HS2 Ltd. and the government only exacerbated the cost creep. For Phase 1 alone, five tunnels were constructed using double-bore machines to excavate deep underground. Tunnels almost always cost more than a surface-level alternative due to the excavation, logistics and preparation required to dig. One of the tunnels, the 10-mile Chiltern tunnel, runs through the lightly hilly and wealthy commuter towns north of London. To appease what has been a heartland for Conservative voters, the government “pressured HS2 to tunnel as much as possible through the Chiltern Hills, causing a rise in costs so sharp that delivering the rest of the line fully may no longer be feasible” per Bloomberg.8 So much of the London-Birmingham leg has been tunneled underground that when completed, passengers will only see daylight for seven minutes on the 45-minute journey, per The Times.9
Tunnels were not the only HS2 money pit. Phase 1 alone plans for two brand-new HS2 stations of magnificent size, such as Old Oak Common in London and Curzon Street Station in Birmingham. Old Oak Common in west London is grandiosely planned with 14 train platforms and estimated by one independent analyst to cost £7.1 billion. 10 Euston Station was the planned terminus in central London and has been tabbed for a major overhaul to accommodate for HS2 with as many as 16 total train platforms. Delays surrounding whether Euston would indeed become the London terminus or not would add another £2.2 billion to the HS2 budget, warned the National Audit Office in March.11 The excessively large, bespoke designs of both Old Oak Common and Euston stations can occur when there is little to no government guidance in restricting size, materials, and standardized design regulations. Indeed, this exact same lack of public stewardship is cited as a major factor in cost overruns in the United States, according to the Transit Costs Project.12
Some journalists and politicians seem spellbound to believe Sunak’s promise of £36 billion saved through HS2 is a settled number, but that cannot be further from the truth. HS2 is tied up in myriad of contracts which face dramatic, if not total, recalls due to Sunak’s announcement with real repercussions. In 2021, HS2 signed a £2 billion contract to order 54 trains from manufacturers Hitachi and Alstom which can travel up to 225 miles per hour.13 Built entirely within the United Kingdom, the trains were scheduled to start arriving at 2027. This contract was the saving grace for an ailing British rail-building industry which urged more government investments in addition to HS2 work to avoid an “an imminent existential risk” on the domestic supply chain, per an industry report in June.14 However, with Sunak’s Phase 2 cancellation, the HS2 order will likely be reexamined and reduced, as 54 high speed trains for a London-Birmingham shuttle service may be far too redundant.
There is reason to believe HS2 was also not informed of Sunak’s decision until the last minute. Just last week, HS2 awarded ground investigation contracts worth up to £300 million to nine different contractors on the now-shuttered Phase 2 route between Birmingham and Crewe15. It is likely there are many other awarded contracts like this, totaling billions of Pounds, which will never see the light of day because HS2 Phase 2 no longer is planned.16 The British government should have known these risks; a 2020 government review known as the Oakervee Review anticipated direct costs of cancelling the HS2 was between £2.5 billion to £3.6 billion, with additional “serious consequences for the supply chain, the fragile UK constructon industry and confdence in UK infrastructure planning” as indirect costs.17
The worst may have yet to come. Following Sunak’s announcement, the Department for Transport has lifted the safeguarding of publicly acquired lands along the proposed Phase 2 route to be used for high speed rail purposes. The land bought for HS2 is now up for purchase. The sale — likely at a fraction of price the government purchased — means that prospects for a future revivification of HS2 would be impossible. Rail experts, including Dennis, have called this move as “madness” driven by spite and “deliberate vandalism” to ensure no future government can build any infrastructure there.18 Moves like this to hamstring current HS2 construction and future growth have alarmed industry groups. “The principal cause of any real-term cost increases lies in the chopping and changing of the project’s scope, with today’s news being the fourth major change by government in just three years,” wrote a spokesperson for the High Speed Rail group, which represents firms working on HS2.19
Sunak and his Cabinet promised the cumulative £36 billion saved from the Phase 2 cancellation would be redirected into hundreds of different transport work — road, rail, bus, and many more, including a £8 billion commitment to repave potholes in England. The day after Sunak cancelled Phase 2, his Government published the 40-page “Network North” plan to detail the work.20 The promises have been underwhelming, with some major gaffes, such as a promise to extend Manchester’s Metrolink tram system to Manchester Airport — which already opened back in 2014.21
The clumsiness, the confusion, and the cruelty have been breath-taking to observe 5,300 miles away from London, here in California. But a spectre is haunting America just as much as Britain: cost overruns run amok with state capacity asleep at the wheel.
HS2 & CAHSR
The signs are ominous, and the comparisons are ripe. Like HS2, CAHSR recently entered the dreadful 100 billion territory; CAHSR’s 50 percent probability (P50) level of total costs for the San Francisco-Los Angeles Phase 1 was reported at $106 billion in its 2023 Project Update Report.22 (The 65 percent probability is at $127 billion) Total costs have risen 56% between the 2012 Business Plan and the 2023 Project Update Report.23
Like HS2 Phase 1, the opening day for its initial leg for CAHSR between Merced and Bakersfield has been pushed back to between 2030 and 2033. The full San Francisco-Los Angeles Phase 1 leg is without an opening timeline as the project is too underfunded to guarantee such a timeline.
Citing a “difficult global environment for large projects”, CAHSR’s Merced-Bakersfield leg is projected to likely cost between $32 billion and $35 billion, up from a previous $26 billion estimate.24 CAHSR lists inflation (responsible for about a $2 billion addition to costs), new scope elements such as stations locations and designs, and external contingencies such as updated right-of-way and professional services as the main reasons for the cost increases.
The CAHSR Peer Review Group, an expert group created by the California state Legislature to conduct independent analysis of the Authority's planning and implementation efforts, echoed similar cost factors in its letter to the Legislature in March. It also mentioned existing litigation in Central Valley, the need for local buy-in, and a diluted delineation of funding responsibilities between state rail authorities and CAHSR as additional factors for the cost increases. It raised major concerns that the project is severely under-funded by the federal and state governments — currently short by $8 billion — and such unstable financing leads to “raising costs and making effective management difficult if not impossible.”25 Writing “with a sense of urgency over the ever-higher stakes”, the Peer Review Group called for a “independent review of the economic and financial justification for the project, including the ability to operate without subsidy…before recommitting to the full Phase I system.”26
Such independent review rings similar to HS2’s Oakervee Review, which was commissioned by then-Prime Minister Boris Johnson in 2019 to revisit whether HS2 was worth continuing. The Oakervee Review concluded “the original rationale for HS2 still holds” and that HS2 should proceed fully.27 However, the review was mired in controversy as the deputy chair of the review, Lord Berkeley, disagreed with the conclusions so strongly that he demanded his name off the report and wrote his own dissenting report.28 Despite the Review’s endorsement of HS2, Johnson cut off HS2’s Birmingham-Leeds limb, leaving the project crippled as Sunak took office. A government-commissioned independent review which comes victorious for the project’s viability does not guarantee its survival.
The only force which can keep CAHSR from following in HS2’s fate are the California legislators and its Governor. Will they demonstrate the political will to bring the proper mechanisms to keep costs manageable and the project moving forward? That is the million-dollar question. The Peer Review Group has presented numerous recommendations to the Legislature in that spirit, such as reviewing all current contracts and processes to tamp down on the costs. It also recommends more funding for CAHSR as “it is critical that any funding approach be fully funded and stable and predictable from year to year”. 29Unstable government support is a key reason why HS2’s costs spiraled out of control. Left unstable with both funding and accountability, CAHSR will too be smothered in its cradle.
Like HS2, CAHSR is playing with a rigged deck of cards. The sheer lack of state capacity and know-how in how to build a high-speed rail in the United States have baked in extra costs where other countries have flushed away decades ago. Even if CAHSR was commissioned some foreign state-run agency with the keys — such as the French SNCF which was infamously rejected because they proposed a straight shot down I-5 skipping Bakersfield and Fresno — it likely would have faced the same institutional inertia, unaligned supply chains, and a dearth of intra-agency cooperation to reduce redundancies and extra costs.30 Through decades of state under-investment, CAHSR is paying for all the externalities and consequences of arrested public development in one bloated price tag. Public transit YouTuber Alan Fisher defends CAHSR’s rising costs as “the cost of education of learning to do this again”. Such tuition costs will only be justified when CAHSR can be allowed to be finished, and the re-education can start all over elsewhere.31
Final Words
Despite my best effort to bridge HS2 and CAHSR’s plights together, the project has too many differences to reductively compare them as equals. I feel it is important to spell them out in rapid succession: HS2’s main purpose was adding tracks to create more capacity to a robust national rail system; CAHSR is building infrastructure to become the spine for a loose confederation of disorganized rail systems statewide. HS2’s London-Manchester leg is only 20 miles longer than CAHSR’s initial Merced-Bakersfield leg and only 40% long as the total San Francisco-Los Angeles leg. CAHSR still has a daunting engineering challenge in placing tracks through the Tehachapi Pass which at 4,031 feet elevation would be the tallest mountain in all of England by near 1,000 feet.
What unites HS2 and CAHSR is its political vision and imagination. It promises a transformative system which would reshape their transportation networks for generations to come. It would be the first of its kind in their respective countries. For CAHSR, especially, its birth could be a major coup in the global fight against climate change (Transportation is the top emitter of greenhouse gases in California, which is the second highest emitting state in the United States, which is the second highest emitting country in the world, behind China). What will likely undermine both projects is a counter-acting political un-vision, where design standardizations, beefing up internal public agencies, and limiting contingencies, among other mentioned recommendations, is as tall to climb as the Tehachapi Pass.
It may be too late for HS2; Keir Starmer, leader of the opposition Labour Party, has declined to reviving Phase 2, demonstrating a shocking lack of political will for a project that remains popular and should be an electoral no-brainer for Labour.3233 For CAHSR, it is not too late to avoid its fate. It is possible to curb costs by realigning working agencies, regulations, labor practices and design standards. The magic fairy dust — as it always has been throughout the world with fantastical high speed networks — is political will to empower such possibilities. But if CAHSR should have bedfellows like Rishi Sunak now or in the near future, then we may as well be polishing its gravestone.
https://youtu.be/M6lsOcYgptw
Ibid.
https://youtu.be/rcjr4jbGuJg
Cost creep was not invented by the MIC, but they gave the process bones, and then built entire systems with ISO9000 documentation that have spread on how to drain the common weal and transfer it into the pockets of the 0.001% and their minions in the 1%. My gut feeling is not that the rail project did not suffer from cost creep, but that there were better ways to transfer that wealth invisibly at a higher rate of return which came into being. One of these new, better corruptions in the war in Ukraine. A train has to deliver at the end, canceling before it is completed is the best way to hide how much of the money went into pockets and not into equipment. Weapons are similar, an airplane that does not fly and can't possibly fight (F35) or aircraft carrier that can't sail are much less sensitive to the public as long as these devices are never really needed. Better yet, a real, functioning aircraft carrier is a white elephant (in an era of hypersonic missiles), and more likely to be sunk than one stuck in dry dock.
Really well researched SY, and an awesome title! Am featuring it on tomorrow's LondonReconnections.com Monday's Friday Reads.