June 27, 2013

British government adds £10bn to HS2 project

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THE budget for the construction of the new HS2 high-speed line linking London, Birmingham, Manchester and Leeds has been increased by the British government from £33bn to £42.6bn. This increases the so-called contingency fund for the project to £14.4bn.

Justifying the increase to members of parliament, the secretary of state for transport, Mr Patrick McLoughlin, said: "While I expect the final costs to be lower than those I have outlined... this is the right way to plan the project." The increased budget also takes account of design and environmental changes made to appease people objecting the project. The government also says a further £7.5bn will be needed to acquire a fleet of 400km/h trains. Nevertheless the government remains committed to the project and has set a detailed budget worth £16bn for HS2 from 2015-16 to 2020-21.

The government has also announced further investment in the conventional rail network as part of its 2015-16 spending review. Network Rail will be allowed to continue major projects already underway such as Crossrail and Thameslink in London, the Northern Hub, and electrification and will be allowed to invest £9bn between 2014-15 and 2018-19. Total spending on rail including maintenance for the period will be £16bn.

Transport for London (TfL) will be provided with a capital grant of £5.8bn and allowed to borrow a further £3.8bn between 2015-16 and 2020-21. This includes funds for TfL's share of the Crossrail scheme, and £2bn for a detailed study of funding options for Crossrail 2, a new north-south link across London. The government has also approved the £115m electrification of the Barking – Gospel Oak line in north London, and the transfer of some London suburban lines to TfL.

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