Tag: Andrew Stephenson

The speech made by Andrew Stephenson, the Minister of State at the Department for Transport, in the House of Commons on 26 November 2021.

I congratulate my right hon. Friend the Member for North Somerset (Dr Fox) on securing this debate on an issue that I am very aware is of great importance to both him and his constituents. I also congratulate him on his Down Syndrome Bill earlier today, which I was delighted secured Government support.

My right hon. Friend has been a passionate advocate for the restoration of the rail link to Portishead for many years, frequently championing the case in this House, and outside the House directly to Ministers. The restoration of the railway is part of MetroWest, which is a third-party scheme promoted by the West of England Combined Authority and North Somerset Council. The Government have committed to funding the scheme, with £31.9 million of support to close the funding gap on this project. This is dependent on the success of the development consent order that my right hon. Friend mentioned, alongside the endorsement of a full business case through the rail network enhancement pipeline.

The application for a development consent order for the Portishead branch line MetroWest phase 1 scheme includes works and powers to enable the reinstatement of the railway line between Pill and Portishead, an upgrade to an existing freight line and two new stations. The section to be reinstated has significantly overgrown since the railway stopped running to Portishead in 1964 and would require some clearance work. The scheme also involves proposals for clearing vegetation along the existing freight line through the Avon gorge woodlands special area of conservation, which is home to a number of rare species of plants including the Bristol whitebeam.

The examination into this application for a development consent order began on 19 October 2020 and concluded on 19 April 2021. Following this, the Secretary of State received the examining authority’s report on 19 July, with a statutory deadline for a decision by 19 October. As with all nationally significant infrastructure projects such as this, this is a complex scheme and there can be detailed matters that need to be worked through even after an examination has closed.

My right hon. Friend will be aware that, following the written ministerial statement laid on 19 October by the Under-Secretary of State for Transport, my hon. Friend the Member for Witney (Robert Courts)—the Minister for Aviation, Maritime and Security—the decision on this development consent order application has been extended to 19 April 2022 to allow for further consideration of environmental matters. Since then, the Secretary of State has requested additional information from North Somerset Council, as the applicant for the DCO, and comments have been invited from interested parties on this response.

Dr Fox

I hope it is not pointing out the blindingly obvious that when people look at projects like HS2, which are able to tunnel under the entire area of the Cotswolds, they find it a touch hard to swallow that we have significant delay because there is some overgrowth on a line that last ran in the 1960s. I hope the Government will understand that.

Andrew Stephenson

My right hon. Friend makes a valid point, although I am sure he will remember that phase 1 of HS2, taking the line from London to the west midlands, took four years to get through the House and the detailed examination of tens of thousands of pages of an environmental statement. I, like him, want to see us moving forward projects at pace, but however we legislate for nationally significant infrastructure projects—whether by hybrid Bill, DCO or other means—there is a process we have to follow and it is, unfortunately, quite bureaucratic. But I think we also share a view that we must protect the environment and do everything we can to mitigate the impacts of all such schemes.

This is still a live planning application and it will now be for the Secretary of State to consider his decision in the light of the original report and the recommendations from the examining authority and all other relevant information, including the responses to the most recent consultations. As the Secretary of State is the decision maker for all applications for transport DCOs and the competent authority for any habitat regulation assessment, this is required to be undertaken to assess the impact of a scheme on a European-protected site, such as the Avon gorge woodlands special area of conservation. It is important that he, or any other Minister delegated to undertake a planning decision on behalf of the Secretary of State, brings an unbiased, properly directed and independent mind to his consideration of that application. Decisions on applications need to be based on planning matters only and all decisions need to comply with all necessary processes and legislation regardless of the risk or otherwise of potential legal challenge.

I am not involved in the decision on this DCO, but my right hon. Friend will understand that, as the decision on the application is under consideration in the Department, I cannot take part in any discussion of the pros or cons of the proposal. That is to ensure the process is correctly followed and remains fair for all parties.

I recognise that extending decision deadlines for DCOs has implications for the scheme’s delivery and the Government’s commitment to levelling up. It is therefore only used where it is absolutely required to take further necessary steps to ensure a legally robust decision. While a new deadline for a decision on the DCO has been set for 19 April 2022, the Department is working hard to enable a decision to be made ahead of that deadline.

I recognise that all transport schemes have an environmental footprint. It is right that we fully understand them and any other impacts resulting in such schemes, and ensure that they are mitigated appropriately, whether that is in relation to the planning decision or the funding decision.

With regard to funding for the scheme, I can assure my right hon. Friend that the Department will continue to work closely with the West of England Combined Authority, North Somerset Council and Network Rail counterparts on the approval process of the scheme’s full business case. I understand that the West of England Combined Authority and North Somerset Council sent a letter to the Secretary of State on 12 November that set out concerns about the extension to the DCO deadline and ongoing costs. A reply to that letter will be sent shortly.

In conclusion, the Government are committed to improving rail services in the wider Bristol area. I understand my right hon. Friend’s impatience for the scheme to progress, following his years of campaigning. As I have set out, the application for any development consent order needs to follow appropriate processes and any decision must be made in line with the relevant legislation to ensure that it is robust. We are aware of how important the scheme is to my right hon. Friend’s local area. Although I am unable to comment directly on the merits of the individual DCO application in respect of funding from my Department, we will continue to provide support to the West of England Combined Authority and North Somerset Council to help them to develop their business case.

I hope that my right hon. Friend is reassured that my Department fully appreciates the importance of the proposal to his constituency, and we heard that message loud and clear again today. I thank him for raising this important issue.

Dr Fox

With the leave of the House, Madam Deputy Speaker, I wish briefly to respond.

We have all become used to reading between the lines in these debates. I take it from my hon. Friend’s speech that the Government are not ruling out a decision earlier than April, which would be a good thing. If I am correct in that interpretation, let us get on with it.

My hon. Friend mentioned the environmental sensitivities in respect of Avon gorge; I should point out that the railway already runs through the gorge to get to Royal Portbury dock, so that is something of a red herring.

For many of us, with this recurrent delay, the pantomime season has come early. There is a very thin line between frustration and farce. I know that my hon. Friend sympathises with my points—I can tell from his tone—and wish him well in persuading his Department to see that, although it is something of an oxymoron, common sense is still the best way forward.

The statement made by Andrew Stephenson, the Minister of State at the Department for Transport, in the House of Commons on 20 October 2021.

I have been asked by my right hon. Friend, the Secretary of State to make this written ministerial statement. This statement confirms that it has been necessary to extend the deadlines for decisions on the following two applications made under the Planning Act as indicated below to allow for further consideration of environmental matters:

M25 junction 10/A3 Wisley interchange: for the proposed development by National Highways which would authorise a number of improvements to the junction between the M25 and the A3. The Secretary of State received the Examining Authority’s report on 12 October 2020 and the current deadline for a decision was 12 November, having been extended from 12 January 2021 to 12 May 2021 and then to 12 November 2021. The deadline is now extended to 12 May 2022;

M54 to M6 link road: for the proposed development by National Highways which would authorise a link road between junction 1 of the M54, junction 11 of the M6 and the A460 to Cannock. The Secretary of State received the Examining Authority’s report on 21 July 2020 and the current deadline for a decision was 21 October 2021. The deadline is now extended to 21 April 2022.

Under section 107(1) of the Planning Act 2008, the Secretary of State must make his decision within three months of receipt of the Examining Authority’s report unless exercising the power under section 107(3) to extend the deadline and make a statement to the Houses of Parliament announcing the new deadline.

The Department will also endeavour to issue decisions ahead of the deadlines above wherever possible.

The decision to set new deadlines is without prejudice to the decisions on whether to give development consent for the above applications.

The statement made by Andrew Stephenson, the Minister of State at the Department for Transport, in the House of Commons on 20 October 2021.

Review of High Speed 2 (HS2) including programme update, local community impact and engagement, environment and benefits.

I am proud to report significant progress on High Speed 2 (HS2) in my third update to Parliament on the project. We remain within budget and schedule, have hit major construction milestones, made substantial progress with key procurements, and are crucially supporting more jobs than ever before—all demonstrating just how HS2 is central to this Government’s mission to ‘Build Back Better’ from the covid-19 pandemic.

Key achievements in this reporting period are—February to August 2021 inclusive:

Recent announcement that the project now supports 20,000 jobs, just over a year since the Prime Minister marked the start of main construction. To date, over 2,200 businesses, 97% of which are UK-registered, have delivered work on HS2.

Launching the first tunnel boring machines (TBMs) that are digging the 10-mile-long tunnels underneath the Chilterns hills. The two TBMs have driven a combined distance of approximately 1.5 miles and are progressing ahead of schedule. Construction on the new ‘superhub’ HS2 station at Old Oak Common—supporting 2,300 jobs and 250 apprenticeships—has also started.

At Euston, we’ve confirmed the move to a less complex, more efficient 10-platform design, which can be built in a single-stage, and can still support the full operation of the HS2 network.

Releasing tenders for Phase One and 2a rail systems packages, with 14 rail systems packages available over the next two years—which include systems for track, power, signalling and communications.

On Phase 2a, commencing early environmental works which marked the first stage in extending the railway from the West Midlands to Crewe and starting procurement for a Design and Delivery Partner (DDP).

Announcing the Government’s commitment to deliver a ‘net gain’ in biodiversity for the next Phase of HS2—Crewe to Manchester.

This report uses data provided by HS2 Ltd to the HS2 Ministerial Task Force for phases 1 and 2a, and covers the period between February 2021 and August 2021 inclusive. Recommendations from the Public Accounts Committee (PAC) report of 22nd September 2021 have been considered and I will provide an update on the continued implementation of these recommendations in my next report.

Programme update

Schedule

In my last report, I confirmed that phase 1 remained within its projected delivery into service (DiS) range of 2029 to 2033. I also committed to providing an update on the outcome of a schedule re-planning exercise to mitigate the impact of delays that have arisen since the schedule was set at the start of last year—of which some are covid-19 related.

This exercise was undertaken by HS2 Ltd and its suppliers, and the exercise has now concluded. Construction activities have been successfully re-sequenced to deliver a schedule that reflects an increasingly mature understanding of the years of works ahead. The resequencing helps resolve a large number of previously reported schedule pressures, while still retaining the phase 1 DiS range of 2029 to 2033. The cost of these mitigations has been assessed at £110 million and will be covered by contingency delegated to HS2 Ltd.

While the forecast DiS range for phase 1 remains 2029 to 2033, HS2 Ltd has identified some potential minor delays in the southern section of the line of route and tunnels leading into Old Oak Common from outer London. Our focus now is to identify efficiencies and control risk in these key areas. The most notable risks include:

Residual delays in completing enabling works and handover to Main Works in certain locations.

Slower than planned design progress and securing planning consents by the Main Works Civils Contractors that are limiting productivity of the supply chain.

The consequential impacts of covid-19, which has continued to cause disruption within this reporting period.

Following Royal Assent of the phase 2a High Speed Rail Bill, the phase 2a DiS range has now been set to 2030 to 2034. New delivery arrangements have been approved, including a DDP that will act as a strategic partner for HS2 Ltd to provide support in managing design and construction.

Affordability

HS2 remains within budget. The overall budget for Phase One, including Euston, remains £44.6 billion. This is composed of the target cost of £40.3 billion and additional Government-retained contingency of £4.3 billion. The target cost includes contingency delegated to HS2 Ltd of £5.6 billion for managing risk and uncertainties.

On phase 2a, revised delivery arrangements were approved in June based on an updated cost range of £5.2 billion to £7.2 billion, broadly similar to the National Audit Office’s (NAO’s) report of January 2020. Arrangements will be formalised in the spending review.

To date, out of the phase 1 target cost of £40.3 billion, £12.9 billion has been spent, with an additional £1 billion for land and property provisions. £12.4 billion has additionally been contracted, with the remaining amount not yet under contract or drawn as contingency.

Since my last report, the first £15 million of the £4.3 billion of Government-retained contingency for phase 1 has been allocated, to increase the number of trains that Old Oak Common station can serve from three to six trains per hour while it acts as the temporary London terminus. This will unlock substantial economic benefits until the completion of the new HS2 station at Euston.

To date, HS2 Ltd has drawn about £0.8 billion of its £5.6 billion delegated contingency. Contingency use to-date reflects an increase of about £0.4 billion since my last report to Parliament. The rate of contingency draw is expected at this stage given the nature of current enabling and civils works and the scale and complexity of the programme.

HS2 Ltd is currently reporting future potential cost pressures of around £1.3 billion—compared with my previous update of about £0.8 billion. If these cost pressures materialise, they will be drawn from contingency held by HS2 Ltd, of which £4.8 billion remains. Of the £1.3 billion potential contingency drawdown, the key cost pressures currently being reported which may require a call on contingency delegated to HS2 Ltd if not mitigated are:

An estimate of £0.6 billion for the slower than expected mobilisation of Main Works Civils Contractors for phase 1, associated with delays to enabling works handovers, design approvals and securing of planning consents. This estimate is, in part, informed by the schedule re-planning exercise.

A £0.4 billion pressure on Euston cost estimates—which remains unchanged from my last update to Parliament. However, now that the move to a smaller, less complex 10-platform single stage delivery strategy at Euston has been confirmed—which will still support the full operation of the HS2 network, the Department for Transport (DfT) anticipates that cost pressures at Euston will be reduced as the updated station design is developed over the coming months.

A further £0.15 billion pressure has been reported for delivering on-network works on the existing Euston network that are required to facilitate the new HS2 station.

HS2 Ltd has identified over £0.3 billion in savings and continues to focus on realising further efficiencies and opportunities to reduce the cost of phase 1.

On covid-19 costs—which will be managed from within Government-retained contingency—HS2 Ltd is making good progress with its suppliers to quantify the impacts on individual contracts ahead of submitting claims to request drawdown of Government-retained contingency. Since my last report, HS2 Ltd has updated its assessment of the likely financial impact of the pandemic on delivering phase 1 and estimates the full costs within the range of £0.4 billion to £0.7 billion—this has been authorised by DfT. The assessment was based on the extended duration of restricted working practices anticipated to run to a revised end-point assumption of December 2021.

DfT and HS2 Ltd have agreed in principle a set of initial claims that include direct and measurable costs of restrictions that relate to the initial phases of covid-19 in 2020. These will now be subject to Government scrutiny and will require formal approval before funds from Government-retained contingency can be allocated.

Delivery

On phase 1, work is well under way at our 340 sites between London and the west midlands and construction of the line-of-route continues to gather pace. Health and safety remains a top priority for the project as work continues to ramp-up. With over 4 million hours worked across the programme per month, there has been an increase in the number of safety related incidents. HS2 Ltd is focused on continual improvement with its supply chain including through embedding lessons learned and cross-functional learning between integrated project teams comprising of HS2 Ltd staff and its contractors.

The launch of the first 2 TBMs—Florence and Cecilia—marked a significant moment for the project. The TBMs are the largest ever used on a UK rail project and will excavate tunnels underneath the Chilterns for the next three years. Further TBM launches are planned in the coming months, including excavation under Long Itchington Wood.

Elsewhere, good progress has been made on the four new HS2 stations along phase 1. In June, the Transport Secretary visited Old Oak Common to mark the start of permanent construction. This ‘super-hub’ station truly shows the Government’s “Plan for Jobs” in action—kickstarting major regeneration, supporting 2,300 jobs and 250 apprenticeships in construction.

In the west midlands, a design and build contract for Birmingham Curzon Street station was awarded to HS2 Ltd’s new construction partner on time. HS2 Ltd has also recently announced the shortlist of bidders for the contract to build the award-winning Interchange Station in Solihull, and contract award is planned for summer 2022.

In response to a recommendation from the Oakervee Review about looking into the efficiency of the Euston station, the move to a smaller, simpler 10-platform station design at Euston has now been confirmed, which can be built in a single-stage—instead of an 11-platform, two-stage build. This will provide a more efficient design and delivery strategy and play a significant role in mitigating the affordability pressures recently identified. Moving to this revised HS2 Euston station design maintains the station infrastructure capacity to run 17 trains per hour, as set out in the phase 1 full business case. We are continuing to explore opportunities for greater integration between the HS2 and Network Rail stations through the Euston Partnership, and to optimise the oversite development above the Euston terminus. Further details will be provided in my next update.

We have reached a major milestone on the procurement of rail systems. HS2 Ltd has started to release tenders for phase 1 and 2a rail systems packages for systems such as track, catenary, power, control and communications. This will continue over the next two years.

There have been various legal challenges to the rolling stock process, but we expect the contract award to be in the autumn subject to there being no further challenges. It is not expected that this delay will affect the planned opening of phase 1 services.

Following Royal Assent of the Phase 2a High Speed Rail Bill, we have continued to deliver the enabling works contracts, consisting of ground investigations, utility diversions and environmental works. Early environmental works mobilisation commenced in April and the second enabling civil works package in July. The procurement of the DDP and advanced civil works contract (ACW) started in June; the tenders for ACW have now been released; and the publication of the DDP tenders is due to happen shortly.

On phase 2b, preparations are under way for a hybrid Bill for the western leg—between Crewe and Manchester —to be deposited in Parliament in early 2022.

We will soon publish the integrated rail plan (IRP) for the North and Midlands which will set out how we will deliver and sequence HS2 phase 2b, Northern Powerhouse Rail and other major rail schemes, such as Midlands Rail Hub, to ensure transformational rail improvements and benefits are delivered to passengers, businesses and communities more quickly.

Local community impact and engagement

As HS2 Minister, I expect affected communities to be at the heart of our plans for this project. That is why I previously committed to follow-up on the conclusions of the Land and Property Review published in November 2020.

The Land and Property Review generated a number of proposals intended to transform how people and businesses affected by HS2 are treated. I am delighted that DfT and HS2 Ltd have implemented over half of these proposals, double the number implemented at the time of my last report. This spring, I went a step further and launched a six-week public consultation to seek views on proposals that required further engagement—how to improve community engagement on the land and property buying programmes, and how to protect the interests of those affected. Findings from the consultation, which will be published this autumn, will inform policy changes.

A priority since my last report has been to ensure that the Transport Secretary secures all the land needed to build the first phase of HS2 before compulsory purchase powers expire in February 2022. HS2 Ltd remains on target to complete the process of serving compulsory purchase notices on landowners where property is to be permanently acquired before the end of compulsory purchase powers. Affected property owners are being notified. We recognise that compulsory purchase has an impact on property owners, some of whom will see land that was previously taken into temporary possession now permanently acquired, and HS2 Ltd is talking to land owners to explain why this is necessary.

Over £10 million of funding has now been distributed by the HS2 Business, Community and Environment Funds. This milestone means over a quarter of the Phase One funds have now been allocated, delivering community benefits across 172 projects located near the line of route. Since April this year, a further £5 million has been made available to extend the funds to communities and businesses living on the Phase 2a route. These funds play a crucial role in ensuring a positive legacy for communities most affected by HS2 construction and I look forward to many more projects up and down the line being supported.

In terms of community impacts, DfT’s independent team of construction inspectors now act on my behalf to objectively assess community concerns. The inspectors have now visited many sites along the Phase One route, identifying a range of good practice and innovation, as well as some risks—notably difficulties with acquiring planning consents and delays caused by illegal protesters. A refreshed HS2 Community Engagement Strategy will also be launched soon.

With regard to protester activity, which HS2 Ltd estimates has cost the project up to £80 million, the Government are making sure that HS2 Ltd, its supply chain, emergency services and wider Government have a co-ordinated response to illegal protest. Regrettably, some protesters have turned to violent and aggressive behaviour, particularly against HS2 Ltd’s supply chain. The Government are taking steps to ensure that illegal protester activity is properly dealt with and that safety risks are minimised.

Environment

As we look to the 2021 United Nations Climate Change Conference (COP26), I wanted to reiterate the Government’s ambition of building the most sustainable high-speed railway in the world, so we play our part in helping the UK to tackle climate change and reach net zero carbon emissions by 2050.

I am delighted to confirm that HS2 Ltd will shortly publish its first environmental sustainability report, which will provide a clear and up-to-date account of HS2’s environmental impacts and the important work that is being deployed to mitigate for any adverse effects.

Further to this Government’s previous commitment to deliver ‘no net loss’ to biodiversity across all phases, I am pleased the Government confirmed in June their further commitment to aim to deliver a ‘net gain’ to biodiversity for the next phase of HS2, the Crewe to Manchester scheme. This commitment will build on the significant environmental legacy of earlier Phases, such as the new nature reserve on the Colne Valley Western Slopes, which recently received local planning approval.

I also recently launched the new £2 million Biodiversity Investment Fund (BIF) on phase 2a to identify opportunities to work with local stakeholders to produce biodiversity gains through the creation and restoration of ecological habits along the phase 2a route.

Good progress is also being made on delivering our decarbonisation agenda. The Government published their Transport Decarbonisation Plan, which outlines the policies required to enable the sector to meet its net zero emissions target by 2050. HS2 will be an integral part in delivering the UK’s future net zero rail network.

Benefits

Since my appointment as HS2 Minister, I have been totally committed to ensuring the benefits of HS2 are realised as widely as possible. In August I welcomed the announcement that, at its peak, HS2 will support 34,000 jobs, 4,000 more than forecast in my last update. The jobs boost comes at a crucial time as the UK strives to “Build Back Better” from the pandemic. HS2 is already playing a crucial role in the UK’s post-pandemic economic recovery, with over 20,000 jobs currently supported. In addition, over 2,200 businesses have delivered work on HS2, with 97% UK registered.

HS2 Ltd has a clear benefits management and evaluation strategy that drives how the programme’s benefits for each phase flow through to the HS2 supply chain. The DfT continues to work closely with HS2 Ltd, local Government and central Government Departments to maximise the benefits of HS2 for people, communities and businesses. The DfT and the Department for Levelling Up, Housing and Communities are continuing to engage with HS2 station places, to understand their local growth and regeneration ambitions, and how we can work with them to realise those ambitions.

The publication of HS2 Ltd’s ‘Building Skills to Deliver’ report demonstrates the potential opportunities HS2 has to offer as we level up our country. The report highlights the critical role that HS2 is playing in supporting young people and unemployed people back into work after the pandemic. It notes that the total workforce for phase 1 and 2a is expected to peak at around 26,500 people over the next two years and that there will be a constant labour demand of 23,600 to 26,500 people from now until 2025-26. The report also reaffirms that the HS2 programme will create 2,000 apprenticeships, with over 650 having been started since 2017. HS2 Ltd is also committed to promoting opportunities to local people as well as those from underrepresented and disadvantaged groups.

Forward Look

On phase 1, focus remains on overseeing the massive construction programme and I expect progress on closure of remaining early works, with handover of sites by summer 2022. I expect to see HS2 Ltd award the contract for rolling stock, and for HS2 Ltd to complete the process of serving compulsory purchase notices on landowners where properties are to be permanently acquired.

On phase 2a, focus remains on selecting a DDP and to launch procurement for the main civil works framework which is expected to commence in early 2022.

On phase 2b, work on legislation for the Crewe to Manchester scheme continues, with the view to depositing a hybrid Bill in early 2022.

On wider programme governance, I would like to thank Allan Cook CBE who left HS2 Ltd in July after two and an half years as Chairman. A search is underway to find a new Chair and I will provide an update on this in my next report. I am also currently working to complete an updated HS2 Framework Document and Development Agreement to ensure continued effective governance between DfT and HS2 Ltd.

I will continue to engage closely with Parliament and will provide my next report in spring 2022.

The statement made by Andrew Stephenson, the Minister of State at the Department for Transport, on 23 March 2021.

I wish to make the following statement:

Overview

This is the second bi-annual update to Parliament on the progress of High Speed Two (HS2). It marks one year since the Government gave phase 1 of the scheme, between the west midlands and London, the green light to begin civils construction. The report uses data provided by HS2 Ltd to the HS2 ministerial taskforce for phases 1 and 2a and covers the period between September 2020 and January 2021 inclusive. Copies of this report have been placed in the Libraries of both Houses.

Covid-19 has made this an incredibly challenging year, and the pandemic has had a devastating effect on individuals, our economy and our communities. However, as we look to the future, with the roll-out of the vaccine firmly under way and a road map out of lockdown now in place, this Government are more committed than ever to “build back better”. HS2 remains at the forefront of our long-term investment plan to better connect people and places, boost productivity and create jobs to help rebalance opportunity across the UK.

Just as importantly, HS2 will play a pivotal role in creating a greener alternative to regional air and road travel. This is essential if we are to meet our commitment to bring greenhouse gas emissions to net zero by 2050.

The key achievements of the HS2 programme in this reporting period include:

Progressing the remaining enabling works and mobilising main civils construction for phase 1 while employing covid-safe working practices.

Achieving Royal Assent of the Phase 2a High Speed Rail (West Midlands – Crewe) Bill, cementing in law the Government’s commitment to bring the new high-speed railway to the north of England.

Evolving our approach to community engagement, including an enhanced complaints procedure to address concerns about how HS2’s impact on communities along the line of route is managed.

Speedy implementation of over a quarter of the proposed reforms recommended by the land and property review of November 2020, improving the experience of property owners most immediately and directly affected by HS2.

Supporting over 15,000 skilled jobs and creating more than 500 apprenticeships. Over 2,100 companies now have contracts with HS2 Ltd, with 97% of these being UK-based businesses. At its peak the programme will support over 30,000 jobs and create at least 2,000 apprenticeships.

Establishing HS2 Ltd’s Environmental Sustainability Committee to strengthen oversight and reporting of efforts to limit and mitigate the environmental impacts from the construction of the railway.

Planting over 430,000 trees so far, with the number expected to rise to over 730,000 trees by spring 2021.

Programme update on schedule, affordability and delivery

Schedule

Some schedule pressures on phase 1 have emerged from delays in completing enabling works including issues with completing utilities diversions, postponed land acquisition and access during the first covid-19 lockdown, and slower than planned development of detailed designs by the main works contractors.

HS2 Ltd is currently re-planning its schedule for phase 1 in conjunction with its construction suppliers with a view to mitigating these delays. The schedule pressures reported above will not impact the projected delivery into service date range of 2029 to 2033 set last year, but further cost pressures could still emerge if mitigation activity is required. The re-planning exercise is due to conclude in the spring and I will update Parliament on its outcome in my next report. We should continue to remain cautious of the accuracy of long-range estimates this early in a 10-year programme.

Affordability

The overall budget for phase 1, including Euston, is £44.6 billion (2019 prices). This is composed of the target cost of £40.3 billion and additional Government-retained contingency of £4.3 billion. The target cost includes contingency delegated to HS2 Ltd of £5.6 billion for managing the risk and uncertainties that are an inherent part of delivering major projects.

The target cost for phase 1 remains at £40.3 billion. Around £11.0 billion (actual prices) has been spent to date, including land and property provisions. Approximately £12.6 billion (2019 prices) has additionally been contracted, with the remaining amount yet to be contracted.

To date HS2 Ltd has drawn £0.4 billion of its £5.6 billion delegated contingency to specific additional costs, which represents 4% of the overall contingency for phase 1, and reflects an increase of £0.2 billion since my last report. HS2 Ltd is currently reporting potential cost pressures of around £0.8 billion over and above this. If these, or other costs, come to pass, then they would be managed from within the existing total budget using the remaining HS2 Ltd delegated contingency. In the case of verified cost increases resulting from covid-19, these will be managed from within the Government-retained contingency.

The cost pressures currently being reported by HS2 Ltd which may require a call on contingent if not mitigated are:

An estimate of £0.4 billion, predominantly due to slower than expected mobilisation of main works civils contractors, associated with delays to approvals of designs, planning consents, protester action and some covid-19 impacts.

As already reported in the autumn report to Parliament, an estimate of £0.4 billion that relates to Euston station remains. Work to consider opportunities, efficiencies and scope reductions to address potential pressures is now under way. This may be an underestimate of the unmitigated pressure, so the Department has asked HS2 Ltd to provide a revised estimate once it has concluded its initial design work on the revised design as set out below.

My last report to Parliament included £0.4 billion from expected increases in the scope and duration of enabling works. These costs are now expected to be incurred and so are not shown as pressures but have instead been taken into the core cost estimate. They will be funded through surplus provision within HS2 Ltd’s core budget rather than from its delegated contingency. Estimates of the impact of covid-19 are set out below.

Other pressures will arise as the programme progresses, some of which may crystallise into additional costs that will need to be covered from the contingency within the existing budget, and some of which will be mitigated or avoided.

Over the last six months HS2 Ltd has made progress on a programme of opportunities for efficiencies designed to identify and realise tangible savings in delivering the agreed scope of phase 1. From a deeper pool of potential opportunities, HS2 Ltd has so far identified up to £0.2 billion to pursue to the next stages of development. Going forward I will report on progress towards realisation of these opportunities as well as the identification of others through this efficiency programme.

Delivery

On phase 1 the focus has primarily been on progressing the remaining enabling works and preparatory works, and the start of main works. This includes dedicated power at launch sites for the tunnel boring machines (TBMs) by the M25 and Long Itchington in Warwickshire, and moving two huge modular bridges into place at the Birmingham Interchange station site. The first pair of TBMs, Florence and Cecilia, will launch this summer.

Elsewhere, progress continues to be made on the four new HS2 stations. At Euston, work is under way to develop an optimised design and delivery strategy, alongside work by the Euston Partnership to integrate the HS2 and Network Rail stations and wider placemaking across the Euston campus. The Department has instructed HS2 Ltd to investigate whether building the station in a single construction stage can speed up delivery and address cost pressures. Notwithstanding this, bringing the station fully back within its existing budget presents a significant challenge. The initial stage of this work is expected to conclude in the coming months, at which point the Government will confirm any design changes and set out their intended way forward at Euston.

The start of main construction of Old Oak Common station has now been approved and excavation work for the HS2 underground platforms can begin. I also note the High Court’s dismissal of Bechtel Ltd’s legal challenge to the Old Oak Common station construction partner award, which found that HS2 Ltd’s procurement process was in accordance with the rules of the tender and procurement law.

Tender evaluation is under way ahead of the planned award by the summer of a construction partner for Birmingham Curzon Street station and tendering for a construction partner at Birmingham Interchange station is expected to begin this summer. Budget 2021 announced £50 million of funding to develop transport proposals around Birmingham Interchange. This will be matched by £45 million of funding from Arden Cross Ltd and Solihull Metropolitan Borough Council. This will support the goal of the West Midlands Combined Authority, by reconfiguring planned car parking at the regional hub station, releasing 28 hectares of land space for new businesses, homes and jobs in the area.

Qualification of bidders is under way for the majority of the rail systems packages for phases 1 and 2a ahead of inviting tenders. HS2 Ltd is finalising the procurement of the new HS2 rolling stock for phases 1 and 2a, with the contract to be awarded later this spring.

I am a very pleased to report that the HS2 Phase 2a Act, for the section of the route between Lichfield and Crewe, was given Royal Assent in February, after its passage through Parliament. This represents a major milestone for the programme and HS2 Ltd can now begin accessing and acquiring land for the necessary construction works as well as taking forward early environmental and enabling works.

Phase 2a will bring high-speed services to the north, helping to realise the benefits of the whole programme and to underpin future phases of the scheme, while also supporting regional economic growth through the construction stage.

Local consultation on the scheme was undertaken during February and I will publish the consultation report in April before detailing the response to its findings in June, following the election period.

With formal agreement on the scope of the phase 2a scheme now set, the funding and schedule ranges will be finalised alongside the delivery model for the construction works. I will provide more information to Parliament once this work has concluded.

Before the end of spring, the Department will publish the integrated rail plan for the north and midlands (IRP) which will consider how best to deliver and sequence HS2 phase 2b, Northern Powerhouse Rail, and other major rail schemes including schemes within midlands engine rail such as midlands rail hub, to ensure transformational rail improvements are delivered to passengers and communities more quickly.

Preparations are under way for a Hybrid Bill for the western leg (Crewe to Manchester) and supporting outline business case (OBC) to be deposited in Parliament in early 2022, or sooner if possible. Further updates on cost and schedule will be provided at the time the OBC is published.

Impacts from covid-19

Although covid-19 continues to pose a considerable challenge to the programme, HS2 Ltd and its supply chain continues to adapt positively. In the early stages of the pandemic, HS2 Ltd successfully kept a high proportion of its sites open and operating safely and at the time of writing this report 100% of HS2 sites are open, in part due to the collaboration and innovation between HS2 Ltd and its supply chain through initiatives such as rapid testing and the introduction of new social distancing technology. Health and safety guidance at work sites continues to be rigorously followed and remains under constant review. Nothing is more important than the wellbeing of the communities we are working in and the safety of everyone working on HS2.

HS2 Ltd’s initial estimates suggest that the financial impact of covid-19 on the cost of delivering phase 1 up to December 2020 is between £0.3 billion and £0.4 billion, largely as a consequence of schedule prolongation from access delays and reduced productivity.

A proportion of this estimate is already captured within the cost pressures that I have set out above. The full impact of covid-19 on cost and schedule will continue to be assessed, including work to disaggregate covid-19 impacts from other cost and schedule impacts on the programme. The Department will be scrutinising these costs very carefully, and only validated and unavoidable costs arising from covid-19 will be funded from the Government-retained contingency, and therefore covered by the existing HS2 budget. I will continue to update Parliament through my reports as this work progresses.

Local community impact and engagement

Since my appointment as Minister for HS2 I have been clear that managing the programme’s impact on communities along the line of the route is one of my key priorities. That is why last autumn I commissioned a detailed review of the acquisition and compensation process for land and property affected by HS2. The conclusions of the review, detailing opportunities for change across a wide variety of policies and activities, were published in November and will ensure that there is a renewed focus on those people who are being directly impacted by the new railway.

The proposals vary in scale and context, but all seek to improve the experience of property owners most immediately and directly affected by HS2 by improving existing processes and interaction with the public. The Department has worked quickly on implementing the proposals, in close conjunction with HS2 Ltd, the residents’ commissioner (Deborah Fazan) and relevant Government Departments, with 25% now in place. I expect to begin a public consultation later this spring to focus on aspects of the proposals that require further engagement. Alongside the land and property review, I am continuing to engage closely with parliamentary colleagues and the communities they represent.

Due to the scale and nature of the HS2 project, some impacts of construction on line of route communities are unfortunately unavoidable. This January, at the Transport Select Committee, I heard first-hand how HS2 construction is impacting on communities. The testimonies I heard were powerful and strengthened my resolute commitment to ensure that HS2 Ltd properly informs and consults communities and minimises negative impacts wherever possible. I have therefore tasked HS2 Ltd to look again at the way it engages communities to improve the responsiveness, sensitivity and objectivity of its approach.

In response, HS2 Ltd is deploying a package of measures to strengthen its community handling approach including:

A unified single management system for community engagement and complaints handling across HS2 Ltd and the supply chain, so there is a single consistent record for all organisations operating in a single location.

Additional proactive local communications to provide notice and raise awareness of HS2 activity in impacted communities.

Shortened HS2 Ltd helpdesk response times so that construction issues can be picked up, assessed and mitigated quickly.

New area-based delivery unit managers with geographical responsibility for joining up construction contractors and communities to prevent and tackle local issues.

New briefing materials to alert MPs and councillors of the agreed single points of contact along the phase 1 and 2a routes so issues can be escalated if they are not resolved in the first instance.

Enhanced engagement and assurance from the construction commissioner (Sir Mark Worthington) and the residents’ commissioner to provide independent advice on potential improvements to HS2 Ltd complaint handling and community engagement operations.

I have furthermore established a small team of construction inspectors reporting to the Department to support the assurance of the delivery of works along the route. An important part of their role will also be to provide a capability to investigate intractable or persistent construction issues working independently of HS2 Ltd and its suppliers where needed.

I expect these measures to improve engagement and responsiveness in relation to avoidable impacts of construction on local communities. I will continue to review this and remain committed to taking further action if necessary.

Environmental Impact

Another of my key pledges as HS2 Minister is to limit the unavoidable impact of HS2 construction on the natural environment both in terms of direct impacts on biodiversity and its carbon impact.

The first report of the HS2 Ltd Environmental Sustainability Committee will be published in the autumn. The approach and content of the report will be informed by the global reporting initiative methodology, and will also be shaped by seeking input from Natural England, the Environment Agency, the Forestry Commission, the HS2 Independent Design Panel and members of HS2 Ltd’s Ecology Review Group. The Government have also given a statutory commitment to provide an impact assessment of construction on ancient woodland within the report, building on previously conducted assessments. The environmental impact data in the report will be verified externally.

Alongside the new Committee, HS2 Ltd launched its “Green Corridor Prospectus” in December, providing information to the public on projects along the route which are being introduced to mitigate and compensate for the environmental impact of HS2’s construction. This includes over 30 projects funded through the community and environment fund, and the business and local economy fund, which add benefit over and above committed mitigation and statutory compensation.

Further to the commitments made in my last report to support biodiversity improvements on phase 2a, the Department and HS2 Ltd have initiated a study to investigate options to consider whether and how we might move the HS2 phase 2b western leg scheme from seeking no net loss to aiming to deliver net gains in biodiversity.

HS2 Ltd has become the first UK transport client organisation to achieve PAS 2080 accreditation a gold standard for carbon management across the globe. It will continue its work to reduce carbon emissions during construction and operation ahead of COP26 later this year.

Forward look

As well as continued focus on its construction programme for phase 1, the next six months will see HS2 Ltd award contracts for a construction partner at Birmingham Curzon Street and for the supply of the new HS2 rolling stock. Work to identify affordable design and delivery arrangements for Euston station is also expected to progress.

On phase 2a we will conclude work on a preferred delivery model for the construction stage as well as finalising the funding and schedule ranges for the project’s schedule and cost. Work on the legislation and business case for the phase 2b western leg will also continue and the integrated rail plan will be published this spring.

I will continue to engage closely with Members of Parliament and will provide my next report to Parliament in October 2021.

Financial Annex

Annex A: Six-monthly financial report
Phase

Target Cost

Total Estimated Costs Ranges

1

£40.3 billion

£35.0-£45.0 billion

Forecast costs by phase

2a

Not set yet

£5.0-£7.0 billion

2b

Not set yet

£32.0-£46.0 billion*

*Validation of the Phase 2b cost range is ongoing and will be updated to support the bringing forward of separate legislation for the HS2 route into Manchester, in line with the conclusions of the Oakervee review. The range provided excludes scope intended to be funded by other sources such as Northern Powerhouse Rail.

Phase

Spend to date**

2020-21 Budget

2020-21 Forecast

1

£11.0 billion***

£3.79 billion

£3.33 billion

Historic and forecast expenditure

2a

£0.4 billion

£0.18 billion

£0.13 billion

2b

£1.0 billion

£0.25 billion

£0.16 billion

Total

£12.4 billion

£4.22 billion

£3.62 billion

All figures in 2019 prices, are exclusive of VAT and correct as of 31 January 2021 and made up of a combination of resource and capital spend.

**Spend to date is represented in outturn prices.

***Spend to date includes a £1 billion liability (provision) representing the Department’s obligation to purchase land and property.

The statement made by Andrew Stephenson, the Minister of State at the Department of Transport, in the House of Commons on 19 January 2021.

Let me say at the outset that the majority of these amendments are clarifications, corrections and updated references. When a Bill has had such a lengthy passage through these Houses as this one, it is perhaps amazing that there are so few amendments that need to be made. Let me say also that the Government accept all the amendments made by the other place to this Bill.

As you would expect, Madam Deputy Speaker, I will provide some comment on the more substantial amendments, but before I do so, I would like to thank the other place for its careful scrutiny of this Bill. In particular, I thank my noble Friend Baroness Vere of Norbiton for her very great skill and diligence in steering this Bill through the other place. I also wish to extend especial thanks to Lord Hope of Craighead and his Committee for their careful and considered approach to the petitions against the Bill in the other place and for the way they handled their processes during the global pandemic.

Turning to the amendments, Lords amendment 2 introduces a requirement on the nominated undertaker to provide and publish annual reports on the impact of the construction of the High Speed 2 project on ancient woodland. This is a scheme-wide amendment: it applies not just to phase 2a of HS2, but to all phases, including those that the House has not yet considered. The requirement in this amendment to report is about ancient woodland, but I have also committed to wider environmental reporting on the impacts of HS2. I look forward to the first of these environmental reports being published, and I am absolutely committed to holding HS2 Ltd to account on environmental matters.

Lords amendment 3 introduces a new requirement on the Government to undertake the consultation prior to 1 May 2021. This consultation is to be for the people of Shropshire, Staffordshire and Cheshire, and it is to seek views on various types of impacts from the HS2 works. The Government opposed this amendment in the other place, but that was on the basis that it was deemed unnecessary. There has already been considerable consultation with the people of Shropshire, Staffordshire and Cheshire. Nevertheless, I think that accepting this amendment is the right thing to do. As the Minister for HS2, I have been charged with resetting the relationship between the HS2 project and local communities. I have worked continuously with colleagues across the House who represent communities along the line of route. I am listening, and I will not stand in the way of the opportunity to listen more through further consultation. I want to reassure the House that I am taking action on what I hear, where it is needed. Further, I will do all I can to ensure that officials and those working on the project for HS2 Ltd put any consultation responses to the best possible use.

I am acutely aware of the strength of feeling in the affected communities, and I am therefore mindful of the motivation and the sentiments of those who supported and voted for this amendment in the other place. As I have mentioned, extensive consultation has already been undertaken. It is crucial, though, that we remember that local communities are at the heart of this project. HS2 is a massive infrastructure project from which the whole nation will benefit, but there are those who will have to bear a burden for that to happen.

I cannot move on without mentioning that there is a price tag of around £350,000 attached to the consultation. However, the costs of running a consultation are minor compared with the costs of delaying the Bill and of not listening to those who are directly affected by the impacts of these works. Let me therefore be very clear about consultation and engagement. The passing of this Bill does not mean the end of engagement with local communities. Indeed, it is only the beginning of a renewed effort to try to mitigate the impacts of the HS2 works on them. Therefore, while there has already been extensive consultation, I see no harm in there being even more.

The last amendment to which I wish to draw the House’s attention is Lords amendment 5. It simply clarifies when a new road constructed under the powers in the Bill becomes specifically a public highway, and when a temporary highway ceases to be a public highway. This clarifies the position for local authorities and has been highlighted as necessary through learning the lessons from phase 1. The remainder of the Lords amendments—amendments 1 and 4, and 6 to 12—delete references to some specific phase 1 works that have been made obsolete by a Transport and Works Act 1992 order, delete references made obsolete by the repeal of some local Acts and update other references in relation to the Communications Act 2003.

The Bill has already taken far longer to go through Parliament than was anticipated when the legislation was introduced in July 2017. I do not want to delay it further today. I want this section of the railway to be built so that we can hasten the benefits of HS2 to the north as soon as possible and, given all that I have said, I urge the House to agree to the Lords amendments.

The statement made by Andrew Stephenson, the Minister of State at the Department of Transport, in the House of Commons on 17 November 2020.

High Speed Two (HS2) is at the heart of our plans to build back better from the covid-19 pandemic, creating thousands of skilled jobs, boosting connectivity between our towns and cities and helping to rebalance opportunity across the country for years to come.

However, as part of that commitment to build back better, it is crucial that we deliver HS2 in a way that is as considerate as possible of those disrupted by the project, who may face losing their homes and relocating their businesses.

In confirming HS2 would go ahead in February 2020, the Prime Minister also committed to a step change in HS2 Ltd’s performance and to drive improvements in transparency, accountability and value to the taxpayer. This included a renewed focus on placing people—the communities and individuals who will be impacted by HS2—at the heart of everything the Government do.​
So following my appointment as the Minister for HS2, I initiated a review of the HS2 land and property acquisition programme, to ensure that those most directly affected were placed at its heart.

The review examined HS2 Ltd’s operational acquisition processes and, where the evidence demonstrated it, associated wider-Government policies. It focused on four areas:

How to deliver a step change in community engagement on the land and property acquisition programme;

How to protect the interests of those impacted;

How to improve process efficiency and delivery by HS2 Ltd;

And how to drive a better tone, showing conspicuous respect, courtesy and understanding.

Today, I am pleased to publish the findings of this review. Copies of the report have been placed in the Libraries of the House.

The Government are grateful for the contributions made by Members of the House and their constituents, external stakeholders, the HS2 Residents’ Commissioner and the HS2 Construction Commissioner. The review ​also considered lessons from Phase One of HS2 and examined compensation regimes employed on other UK infrastructure projects and abroad.

The review generated a number of proposals that are designed to speed up property valuations and disturbance payments, settle cases and disputes more quickly and build on the improvements HS2 Ltd have been introducing to engage more effectively with people.

The focus now will be on how the Government and HS2 Ltd turn these proposals into long-lasting changes that improve not only the delivery of HS2, but also the experience and wellbeing of individuals, businesses and communities impacted by them.

The Government want to ensure that those living near the route receive the right support at all stages of the project. Importantly, they remain committed to ensuring that those affected are properly compensated and treated with compassion, dignity and respect.

Attachments can be viewed online at: http://www. parliament.uk/business/publications/written-questionsanswers-statements/written-statement/Commons/2020-11-17/HCWS583/.

The statement made by Andrew Stephenson, the Minister of State at the Department for Transport, in the House of Commons on 12 November 2020.

I have been asked by my right hon. Friend the Secretary of State to make this written ministerial statement. This statement concerns two applications made under the Planning Act 2008 relating to the A303.

The first application concerns the proposed construction by Highways England of a new two-lane dual carriageway for the A303 between Amesbury and Berwick Down in Wiltshire (also known as the “A303 Stonehenge” application), which the Secretary of State has today approved.

The second application concerns the proposed construction by Highways England of a continuous dual carriageway on the A303 linking the Podimore roundabout and the Sparkford bypass.

Under section 107(1) of the Planning Act 2008, the Secretary of State must make his decision within three months of receipt of the examining authority’s report ​unless exercising the power under section 107(3) to extend the deadline and make a statement to the House of Parliament announcing the new deadline. The Secretary of State received the examining authority’s report on the A303 Sparkford to Ilchester Development Consent Order application on 12 September 2019 and the deadline for a decision was previously extended from 12 December 2019 to 17 July 2020, and then further extended until 20 November 2020 to allow for further work to be carried out.

The deadline for the decision is to be further extended to 29 January 2021 (an extension of just over two months) to enable further information to be provided by the applicant and the defence infrastructure organisation regarding outstanding concerns pertaining to the issue of bird strike.

The decision to set a new deadline is without prejudice to the decision on whether to give development consent.

The statement made by Andrew Stephenson, the Minister of State for Transport, in the House of Commons on 13 October 2020.

Overview

1/ This government has committed to provide an update to Parliament every 6 months on the progress of High Speed 2 (HS2), of which this is the first. This report covers data reported by HS2 Ltd to the end of August 2020. I have placed a copy of the report in the libraries of both houses.

2/ After careful consideration of the independent Oakervee review and wider evidence, including the National Audit Office’s (NAO’s) progress update, the Prime Minister confirmed to Parliament in February 2020 that the government would proceed with HS2. The government intends HS2 to become the spine of the country’s transport network, bringing our biggest cities closer together, boosting productivity and rebalancing the economy and opportunity for people across the country. It will also help meet our commitment to bring all greenhouse gas emissions to net zero by 2050 by providing a better alternative to regional air and road travel.

3/ In taking this decision, the Prime Minister and Secretary of State for Transport made clear the importance of a tighter grip by the government on the delivery of the project and of the need for full transparency. That is why we have consulted the chairs of the Public Accounts Committee and Transport Select Committee in providing this report to Parliament and I intend for it to provide clear information about our progress.

4/ In April (2020), the Full Business Case for the first phase of the scheme between the West Midlands and London, ‘HS2 Phase One’, was approved with an increased budget and revised delivery into service date. This permitted HS2 Ltd’s Main Works Civils Contractors to begin construction of Phase One. I was delighted to see the Prime Minister mark this significant milestone officially by visiting Birmingham Interchange a few weeks ago.

5/ Authorising the Main Works signalled the government’s commitment to invest in our economic recovery in response to COVID. HS2 is central to our plans to build back better and will stimulate economic growth and rebalance opportunity across this country in the short, medium and long term.

6/ HS2 Phase One is just the first step in levelling-up our great economic regions and better connecting the north, the Midlands and London. That is why we are progressing legislation to deliver Phase 2a to provide a high speed line from the West Midlands to Crewe, where trains will continue further north via the West Coast Main Line. The Phase 2a Bill is currently in the House of Lords. The select committee has finished hearing petitions and we await its report.

7/ To deliver HS2 Phase 2b and Northern Powerhouse Rail more effectively alongside other transport schemes, an integrated plan for rail in the North and the Midlands is being developed. This will be informed by an assessment from the National Infrastructure Commission, expected at the end of 2020. The integrated rail plan will set out the form, scope and phasing of the Phase 2b route. It will also inform decisions on how to improve links to and from Scotland to strengthen the connectivity of the Union.

8/ Achievements in this first reporting period include:

– getting on with delivery by approving the Phase One Full Business Case and authorising the start of construction, supporting the industry and wider economy as part of the COVID response. Indeed, HS2 Ltd and its supply chain supports over 13,000 jobs, including over 400 apprenticeships. At peak construction, this will increase to 30,000 jobs

– getting a stronger grip on delivery to time and budget by establishing the Ministerial Task Force for Phases One and 2a, chaired by the Secretary of State for Transport, and attended by the Financial Secretary to the Treasury, the Minister of State at the Cabinet Office, the Minister of State for Regional Growth and Local Government and myself. We have also strengthened the Board of HS2 Ltd by appointing three additional Non-Executive Directors.

– putting the people and communities impacted by the scheme at the centre of our work by reviewing the land and property acquisition programme, the approach to compensation and, importantly, how HS2 Ltd supports and engages with people along the route. The review will be published shortly.

– revisiting how best to deliver Euston Station as recommended in the Oakervee review, with the aim of providing an improved design and better delivery strategy. This includes revised governance providing closer collaboration between HS2 Ltd and Network Rail, through the new Euston Partnership Board chaired by Sir Peter Hendy.

– developing the integrated rail plan for the North and Midlands. This work focuses on reducing overall costs, identifying the correct schemes and sequencing to improve rail services and to determine how best to improve rail connectivity with Scotland. A separate Ministerial Task Force is also overseeing preparation of the integrated rail plan

– continuing the preparation of legislation for the Phase 2b Western Leg into Manchester, reflecting the findings in the Oakervee review that Phase 2b should be delivered in smaller sections with legislation brought forward as it is ready. This includes the Design Refinement Consultation launched on 7 October (2020). The integrated rail plan will set out the form, scope and phasing of the Phase 2b route, across the Western and Eastern Legs, and the government will therefore consider responses to this consultation alongside the outcomes of the integrated rail plan

– setting out our intent to establish enhanced reporting arrangements to demonstrate how HS2 Ltd is meeting the government’s environmental priorities

Programme update on affordability, schedule and delivery affordability

9/ Earlier this year, the government reset the funding regime for HS2, including a target cost and funding envelope for Phase One and revised estimates for the wider scheme. The total funding envelope for Phase One was set at £44.6bn (2019 prices) and the estimated cost for completing the full network was revised to a range of £72bn to 98bn.

10/ For Phase One, including Euston, HS2 Ltd projects an outturn cost at £40.3bn (2019 prices) which is at the level of its target cost. This projection remains uncertain at this early stage in the project’s lifecycle (as with all major infrastructure projects) and does not yet reflect the impact of COVID. HS2 Ltd is expected to provide its estimate of the COVID impact within the next six months. Any cost changes will be contained within the funding envelope using the contingency already assigned

11/ Of the £40.3bn, £9.6bn has been spent to date, a further £11.5bn is contracted, and £13.9bn is yet to be contracted and remains an HS2 Ltd estimate. The target cost also includes available HS2 Ltd delegated contingency of £5.3bn for managing the risk and uncertainty that are an inherent part of delivering major projects. HS2 Ltd is currently reporting cost pressures of £0.8bn. If not successfully remediated, these pressures will be drawn against the Company’s delegated contingency. These pressures are driven by:

enabling works to prepare the line of route for construction. These have been underway since 2017 and in some areas have encountered more significant challenges than anticipated, such as the need to safely remove more asbestos than expected, resulting in increased scope and duration. These additional costs are likely to be in the order of £0.4bn according to HS2 Ltd

Euston Station, where further development of the baseline scheme has identified a significant cost pressure, which HS2 Ltd is currently reporting as in the order of £0.4bn. Further work is ongoing to validate these initial estimates and this could identify further pressure. As this remains at the design stage, work is underway to consider opportunities, efficiencies and scope reductions in order to redress these pressures and we will report further on this in the next report

12/ The total funding envelope for Phase One remains at £44.6bn (2019 prices). This includes further available contingency of £4.3bn over and above that delegated to HS2 Ltd, which is retained by the Department for Transport and Her Majesty’s Treasury. I am determined to carefully scrutinise the use of contingency to ensure that it is sufficient to cover issues that may emerge later in the project and will provide updates to Parliament through these reports.

13/ The overall Phase 2a cost is currently estimated as in the range of £5-7bn (2019 prices). This remains in line with the estimate set out at the time of the Prime Minister’s announcement on 11 February and the NAO update of January 2020. Firmer ranges and a target cost will be confirmed, subject to the scheme being approved by Parliament and based on the scope and undertakings in the act.

14/ Updated cost estimates will be provided for the Phase 2b links to Manchester and Leeds once the integrated rail plan is concluded. At this stage, ongoing design work suggests some further pressure on the most recent estimates but this depends in part on decisions on the route and sequencing, as well as decisions about the appropriate level of contingency to provide at this stage. We will provide further information as this work matures including as part of preparing legislation for the HS2 route from Crewe into Manchester.

Schedule

15/ On Phase One, the Delivery into Service (DIS) range for initial services from Old Oak Common to Birmingham Curzon Street remains 2029 to 2033. HS2 Ltd continues to predict that it will provide services within this range but notes some pressures on the earliest date from COVID impacts and delayed handovers from Enabling Works, which it is seeking to mitigate. Schedule estimates will be more reliable once the Main Works are fully mobilised next summer and once the Rail Systems elements have been contracted.

16/ The overall response to COVID by HS2 Ltd and its construction partners has been positive with the rapid implementation of safe working practices to protect the public and workers and the re-opening of the majority of sites after a safety review. However, some works have been delayed and at some sites COVID-safe practices have necessarily reduced productivity to a limited degree.

17/ The range for initial opening of services from Euston remains 2031-2036, subject to further work on the study of design and delivery options.

18/ Schedule ranges for Phases 2a and 2b will be established once their scopes are finalised. Delivery progress

19/ The Main Works Civils Contractors are currently taking possession of sites along the line of route on Phase One and mobilising their workforces and equipment, including the delivery of tunnel boring machines. Significant works are already underway at several sites.

20/ The three other Phase One stations, Birmingham Curzon Street, Birmingham Interchange and Old Oak Common, have now received Schedule 17 planning consents. Procurement is underway for the construction of Curzon Street and Interchange stations and design refinement is underway at Old Oak Common ahead of approving the start of construction.

21/ The procurement of rail systems packages for track, catenary, power, control and communications systems has begun. Contracts for two packages, slab track and cross passage doors, have been awarded. The procurement of the rolling stock supplier continues and will be awarded in the summer of next year.

22/ The timeline to achieve Royal Assent of the Phase 2a Bill by the end of the year is challenging, but remains feasible subject to Parliament’s will.

23/ As noted above, preparations are now underway for a hybrid Bill for the Western Leg of Phase 2b (Crewe to Manchester). A consultation on design refinements to support future use of HS2 infrastructure as part of Northern Powerhouse Rail was launched on 7 October. At the same time a route wide update, decisions on changes previously consulted in 2019, and revised property safeguarding were published for the Western Leg.

Community and environmental impact

24/ Since my appointment as Minister for HS2, I have sought to increase the focus on managing HS2’s impact on communities along the line of route and on the natural environment.

25/ Securing the land and property needed to construct the line of route across all Phases is vital to the programme’s success and is often the first impact that we have on line of route communities. A range of statutory and non-statutory property compensation schemes are available that seek to compensate affected parties fairly while protecting the public purse.

26/ Our policy is to provide fair compensation for those directly and indirectly impacted but the process and disputes for claims can inevitably be traumatic for some. I therefore commissioned a detailed review of the acquisition and compensation process to ensure that there is a renewed focus on those who are being impacted by the new railway. The report will be published shortly and we will move to consult where appropriate on the proposed reforms.

27/ Some £3.6bn has now been spent acquiring land and property and in the order of 1,250 properties have been acquired to date across the three phases of HS2. The majority of this is from Phase One where £3.3bn has been spent to date.

28/ I want to make sure that HS2 Ltd and its contractors are as sensitive as possible to the impact of construction on communities where impacts will unfortunately be unavoidable. HS2 Ltd needs to ensure that communities are properly informed and consulted and that the impacts are minimised to the extent that is reasonable. I intend to engage closely with Members of Parliament and the communities that they represent and ensure HS2 Ltd is meeting the terms of its planning consents.

29/ I also intend to increase our efforts to limit the impact of HS2 on the natural environment and to ensure its construction and operation is as low carbon as possible.

30/ In the coming months, HS2 Ltd will establish a new Environmental Sustainability Committee (as a sub-committee of the HS2 Ltd Board), led by its chair, Allan Cook. This committee will be charged with strengthening environmental sustainability reporting including the development and publication of an environmental sustainability report. HS2 Ltd intends to publish the first report next year.

31/ HS2 Ltd has been working with Natural England over the summer to enhance plans to support delivery of the route wide, ‘No Net Loss to Biodiversity’ target. Following Royal Assent of the Phase 2a Bill, HS2 Ltd will continue to explore opportunities to enhance its existing No Net Loss objective for that Phase of the programme. It will identify and implement appropriate opportunities, where it is reasonably practicable, to move towards net gains in biodiversity. This will be supported by a £2m biodiversity fund.

32/ HS2 Ltd is also working in partnership with local communities to create new woodlands, diverse habitats and community green spaces beyond the construction boundary. Funding provided through the Phase One £40m community and environment fund and the business and local economy fund has seen over 126 projects awarded funding of over £7.7m.

Forward look

33/ For Phase One, the focus for the coming year will see the continued mobilisation of the Phase One construction programme and commencement of civil engineering and tunnelling activities alongside further contract awards for stations, rolling stock and systems. I will continue to focus on the control of schedule and cost whilst implementing the reforms on land and property acquisition, managing the impact of construction on local communities, and improving environmental performance and reporting.

34/ Subject to Parliament’s will, the Phase 2a Bill will continue through its final legislative stages to secure authority for construction of the route to Crewe and northern destinations via the West Coast Main Line.

35/ We will continue to define the scope and scheme for Phase 2b as part of the work to conclude the integrated rail plan and to prepare a hybrid bill for the Western Leg from Crewe to Manchester.

36/ I will continue to engage closely with Members of Parliament and will provide my next report to Parliament in April 2021.

The statement made by Andrew Stephenson, the Minister of State at the Department of Transport, in the House of Commons on 7 October 2020.

I have today published new information on the development of the western leg of HS2 phase 2b, running between Crewe and Manchester with a link to the west coast main line. This includes:

A Government consultation on four proposed changes to the design;

A response to western leg changes included in the 2019 design refinement consultation;

A route-wide update, which sets out how the route has developed, including changes in response to feedback from affected communities; and

Updated safeguarding directions for the western leg.

The Government have accepted the findings in the review by Douglas Oakervee that phase 2b should be delivered in smaller sections with legislation brought forward as it is ready. Therefore, HS2 Ltd has taken forward work to develop legislation for the western leg of HS2 phase 2b.​

The Government have also accepted the Oakervee recommendation that plans for HS2 and other major schemes need to be brought together in an integrated rail plan (IRP) for the north and midlands.

The IRP will set out the form, scope and phasing of the phase 2b route, across the western and eastern legs, and the Government will therefore consider responses to this consultation alongside the IRP outcomes. If the IRP favours any major changes, further redesign will need to take place. This consultation seeks to ensure that unnecessary delay is avoided in the event that the IRP does not support change.

Work on HS2 phase 1 from London to Birmingham is already well under way at over 250 active sites, stimulating the economy and providing jobs through the approximately £10 billion worth of contracts already announced, two thirds of which will go to small and medium sized enterprises.

Legislation for phase 2a, from Birmingham to Crewe, is currently being considered by Parliament.

The proposals I am putting forward today are the next step in developing the design and legislation for the western leg of phase 2b, following the 2019 design refinement consultation. Phase 2b of HS2 is key to delivering Northern Powerhouse Rail (NPR) and the consultation includes proposals to integrate the designs at a series of “touchpoints”, which are pieces of infrastructure to enable future connections between NPR and HS2. These proposals have been developed in partnership with Transport for the North and will reduce the amount of infrastructure required to deliver NPR in the future.

This consultation deals with four technical refinements to the western leg of phase 2b: a new Crewe connection, which would also support the vision for a Crewe hub; changes to the already proposed rolling stock depot at Crewe; expansions to the stations at Manchester Piccadilly and Manchester Airport; and a newly proposed facility for stabling rolling stock at Annandale in Scotland.

Changes at Manchester Piccadilly to facilitate Metrolink and Manchester Airport High Speed station are subject to the agreement of local funding contributions. We continue to collaborate positively with Greater Manchester Combined Authority, Manchester Airports Group and other Greater Manchester delivery partners on this matter. Greater Manchester partners have confirmed that they are prepared to prioritise the funding of the local proposals for Metrolink underground at Piccadilly in future funding rounds. This will form part of the shared programme between DfT and Greater Manchester in implementing the Manchester HS2 growth strategy. In the 2020 Budget, the Government made £4.2 billion of funding available to eight city regions for intra-city transport initiatives over the period 2022-23 to 2026-27.

In addition to today’s consultation, I am publishing my response to the proposed western leg changes included in the June 2019 phase 2b design refinement consultation. The Government have decided to proceed with these changes subject to the outcome of the IRP.

I have also published a route-wide update which sets out wider developments to the route. The safeguarding directions for the phase 2b western leg route have also been updated to reflect the project’s updated land requirements.​
Engagement with affected communities is at the heart of our plans for HS2 and it is our commitment to ensure we listen to those affected by these proposals. Restrictions put in place in response to the covid-19 pandemic mean that we will not be able to hold local information events in the same way that we usually would as part of our formal consultation process. HS2 Ltd will deliver information events via digital platforms instead. These digital events will allow those affected the same opportunities to understand what refinements are being proposed and to ask any questions that they may have to our representatives. Where owners of land or property are newly affected by the proposals, they will be contacted directly by HS2 Ltd to arrange online or telephone appointments.

Copies of the consultation Command Paper and safeguarding directions will be placed in the House of Commons and House of Lords Libraries.