The current budget for HS2 Phase One (London-Birmingham) stands at 拢44.6bn. Of this, 拢14.9bn has been spent, with an additional 拢800m for land and property provisions. 拢12.7bn has been contracted but not yet actually spent.
That 拢44.6bn budget figure is not what the government orHS2 Ltd expects it to cost. It should 鈥榦nly鈥� cost 拢34.7bn 鈥� including systems and trains as well as construction. However 拢5.6bn has been added for contingencies to give HS2 Ltd a target cost of 拢40.3bn.
To this 拢40.3bn target cost the government has added another 拢4.3bn contingencies of its own, to arrive at a 鈥榖udget鈥� of 拢44.6bn.
So were HS2 Phase One to come in at 拢42.0bn, the government (and the client organisations) would be able to crow that the project had come in 拢2.6bn under budget - even though it would have actually cost 拢7.3bn more than it should have.
Those 拢9.9bn contingencies are there for a reason.
HS2 Ltd has so far drawn 拢1.3bn of its 拢5.6bn delegated contingency, including 拢500m in the past six months, meaning 拢4.3bn remains.
HS2 Ltd is reporting 拢1.7bn of 鈥減otential future cost pressures that are currently presenting across the programme鈥�. These include an estimate of 拢800m for potential additional main works civils costs stemming from additional design costs and slower than expected progress in some areas. That figure has risen from 拢200m six months ago.
There is also a 鈥減ressure鈥� of 拢400m on the cost estimate for the HS2 Euston station and 拢200m against HS2 Ltd鈥檚 budget for changes to Network Rail infrastructure at Euston and Old Oak Common that are required to facilitate the new HS2 stations.
On Covid-19 costs, HS2 Ltd鈥檚 assessment of the likely financial impact of the pandemic on delivering Phase One is estimated within the range of 拢400m to 拢700m.
Ongoing protester activity, including the removal of camps and protest-related delays to the programme, has cost nearly 拢122m so far.
The minister鈥檚 full report can be read at
Got a story? Email news@theconstructionindex.co.uk
