Hunt insists HS2 rail line will terminate at Euston

Chancellor Jeremy Hunt has insisted the High Speed 2 railway will finish in central London as officials at the project connecting the capital and northern England examine measures to prevent a further surge in costs.

The estimated price tag for Britain’s biggest infrastructure scheme has soared from £33bn to more than £100bn since it was first conceived a decade ago, prompting alarm within the Treasury where ministers are determined to prevent further cost escalation.

As a result, senior figures inside the Department for Transport and HS2 have discussed solutions ranging from dropping the surviving stretch of the eastern second leg of the project or axing the redevelopment of Euston station in central London, where costs have risen by more than £1bn in just two years.

“Clearly there are inflationary pressures . . . and that means the government is having to work through those challenges,” said one person involved in the project.

The Sun reported on Friday that HS2 executives were considering terminating the line at Old Oak Common on the outskirts of London, instead of Euston. Commuters would have to use the Elizabeth Line to travel into central London to finish their journey, reducing the advantage of a high-speed service.

But Hunt rejected that idea in media interviews on Friday morning, saying: “I don’t see any conceivable circumstances in which that would not end up at Euston.”

Redeveloping Euston is crucial to the controversial 225mph project, which was first sold as an alternative to a third runway at Heathrow or an extension to the existing high-speed link to Europe, but now has no direct connection to either.

The state-funded scheme, which has faced protests and criticism since its inception, has been repeatedly scaled back and is now planned to run from London to Birmingham in its first phase and then to Manchester airport, Wigan and Crewe in the north-west.

In 2021, Boris Johnson’s government announced it was axing most of the eastern second leg of the project — from East Midlands Parkway, just south of Nottingham, to Leeds — to find cost savings.

Now, however, some senior government figures have discussed killing the remaining part of the eastern leg, from Birmingham to East Midlands Parkway, to cut costs even further.

Euston also remains a potential target for savings because, despite significant preparatory work, the design has yet to be completed.

Estimated costs for the Euston redevelopment have risen from around £2.8bn to nearly £4bn in 2019 prices, according to an internal document presented last year to HS2’s board by Sir Jon Thompson, the former head of HM Revenue & Customs who became deputy chair of the project in April 2021.

That report also warned that HS2 was running “billions of pounds” over budget in its first phase, which began in 2020 and is due to be completed between 2029 and 2033.

Henri Murison, chief executive of the Northern Powerhouse Partnership lobby group, said a London terminus for HS2 should be “centrally located”, adding: “Even for the north of England, not going to Euston has a number of significant disadvantages.”

More than £4bn of improvements to other parts of the UK’s railway system have already been axed because of a governmental decision to focus spending on the high-speed line.

The DfT said: “The government remains committed to delivering HS2 to Manchester, as confirmed in the Autumn Statement.”