More Delay for HS2, and how should we proceed?

[MontyP]

If OOC becomes the longer-term, or even permanent, terminus, what will happen to the massive building site that used to be called Euston?

 

[SynthD]

If OOC becomes the longer-term, or even permanent, terminus, what will happen to the massive building site that used to be called Euston?

The parts that were CPOd will be offered back per the rules. The rest will be redeveloped in a rush, probably at great loss.

 

[JonathanH]

If OOC becomes the longer-term, or even permanent, terminus, what will happen to the massive building site that used to be called Euston?

It is being made safe for the time being.

The parts that were CPOd will be offered back per the rules. The rest will be redeveloped in a rush, probably at great loss.

It would be a bold move to fully cancel Euston and write off any chance of it being the eventual terminus, as there isn't another obvious site for a terminal station of its ilk. Can it be safeguarded indefinitely or is that not allowed?

 

[stuu]

It is being made safe for the time being.


It would be a bold move to fully cancel Euston and write off any chance of it being the eventual terminus, as there isn't another obvious site for a terminal station of its ilk. Can it be safeguarded indefinitely or is that not allowed?

It is owned by HS2/us. It could sit there empty forever. I would sincerely hope that it is not offered for redevelopment but we can manage to somehow find a financially acceptable way to build it. It's all politics anyway, the amounts being spent are a trivial amount of government expenditure and the site is very likely to produce money for the government in the longer term

 

[MontyP]

It is being made safe for the time being.


It would be a bold move to fully cancel Euston and write off any chance of it being the eventual terminus, as there isn't another obvious site for a terminal station of its ilk. Can it be safeguarded indefinitely or is that not allowed?

Not only is there no other obvious site, but if I understand the plans for OOC correctly, it would be almost impossible to divert the onward extension to a central terminus in any other direction. I suppose the tunnel boring machines could be redirected (hypothetically) to somewhere like Earl's Court/Olympia (although still not very central). Or Paddington, by moving more of the long distance trains out of the main shed (Heathrow Express for starters). There isn't any more space around Kings Cross/St Pancras.

 

[kevin_roche]

Not only is there no other obvious site, but if I understand the plans for OOC correctly, it would be almost impossible to divert the onward extension to a central terminus in any other direction. I suppose the tunnel boring machines could be redirected (hypothetically) to somewhere like Earl's Court/Olympia (although still not very central). Or Paddington, by moving more of the long distance trains out of the main shed (Heathrow Express for starters). There isn't any more space around Kings Cross/St Pancras.

There was another suggestion of building a line via an underground station at Waterloo to Ebbsfleet. I can't remember which organisation suggested it as an alternative terminus and a way to reach HS1. If I remmber rightly is was very expensive.

 

[LNW-GW Joint]

Sunak just refused to comment on HS2 at his statement on Net Zero.

Hunt said in an interview yesterday that no decisions had been taken, but he admitted that HS2 costs were out of control, largely because of inflation.
I imagine the tactic will be to suspend work on Phase 2 until the costs of the whole project are believable and acceptable.
That will take time, maybe 6 months, to establish (and inflation is still working its way through the project).
It's possible no more contracts will be let until the costs are seen to be under control - that includes all the railway systems for Phase 1, station fitout and train specifications (within the contracts already let).
There's also the problem of the Crewe-Manchester bill taking up parliamentary time at the moment - do you continue or cancel?

If NPR is in the equation, planning for its new-build elements are in no better state than HS2 Phase 2, in fact they are well behind with no specific route or service proposals published.
Stopping work on Phase 2 to concentrate on NPR would set back the overall project by a decade or so (which may be what the government wants).

 

[JonathanH]

I imagine the tactic will be to suspend work on Phase 2 until the costs of the whole project are believable and acceptable.

The costs aren't going to come down with a delay. Presumably it is volatility of cost that is unbelievable, rather than the actual cost. If it is unacceptable now, it is never going to be acceptable, as it will always be greater than the point at which it is paused.

 

[Pete_uk]

What about half of the services stop at OOC and half to Euston.

We know there will be good links into London from OOC.

 

[JonathanH]

What about half of the services stop at OOC and half to Euston.

That doesn't remove the cost of building to Euston, nor is it practical at Old Oak Common.

 

[Fazaar1889]

Iirc, Euston is meant to open in 2036. Do you guys think this is likely? or do you think it's possible it will open earlier after the economy stabilises in a couple of years, or will it open later? You guys have been following railway construction for years, so your gut instincts will be better than mine.

 

[350401]

Iirc, Euston is meant to open in 2036. Do you guys think this is likely? or do you think it's possible it will open earlier after the economy stabilises in a couple of years, or will it open later? You guys have been following railway construction for years, so your gut instincts will be better than mine.

It depends on the politicians to be honest. Should the current plans go ahead without further interruption, then Phase 1 OOC-Curzon Street is 2029-33, Handsacre link for WCML services is also 2029-33 but 18-24 months later than the first services, services to Crewe are 2034/35 and Manchester opens 2037-41. Euston will open either in time for Crewe or the full Manchester service, depending on the results of the redesign. The current industry rumours that I am aware of are that a 6/7 platform station will open for 2034/35 for Crewe, and the remaining platforms for the 2037-41 full service. The TBM to Euston was scheduled, even with the current delay, to launch the tunnel drive in around 18-24 months, and is being installed and buried now to enable this.

However, should the politicians announce any more changes, then all bets are off.

 

[MontyP]

The costs aren't going to come down with a delay. Presumably it is volatility of cost that is unbelievable, rather than the actual cost. If it is unacceptable now, it is never going to be acceptable, as it will always be greater than the point at which it is paused.

They could come down either through descoping (fewer platforms?) or through value engineering i.e. reducing the quality of the station - but I would imagine the latter would be fairly marginal.

If there is ever to be a central London terminal, then Euston really is the only option, there is nowhere else for it to go. Underground stations linking to HS1 etc are just fanciful - there just isn't a site in London where a station of that size could be embedded.

 

[Fazaar1889]

It depends on the politicians to be honest. Should the current plans go ahead without further interruption, then Phase 1 OOC-Curzon Street is 2029-33, Handsacre link for WCML services is also 2029-33 but 18-24 months later than the first services, services to Crewe are 2034/35 and Manchester opens 2037-41. Euston will open either in time for Crewe or the full Manchester service, depending on the results of the redesign. The current industry rumours that I am aware of are that a 6/7 platform station will open for 2034/35 for Crewe, and the remaining platforms for the 2037-41 full service. The TBM to Euston was scheduled, even with the current delay, to launch the tunnel drive in around 18-24 months, and is being installed and buried now to enable this.

However, should the politicians announce any more changes, then all bets are off.

Thanks

 

[Meerkat]

The costs aren't going to come down with a delay. Presumably it is volatility of cost that is unbelievable, rather than the actual cost. If it is unacceptable now, it is never going to be acceptable, as it will always be greater than the point at which it is paused.

Isnt Cost pressure eased if you slow down build so are chasing fewer construction workers/assets at any one time?

 

[HSTEd]

Isnt Cost pressure eased if you slow down build so are chasing fewer construction workers/assets at any one time?

To a degree, but your other costs will keep climbing.

Construction inflation has been climbing faster than regular inflation for decades.
And there are costs associated with how long the project continues, and if construction drags on too long some components will have to be replaced because they have exhausted their lifespan before the project is even finished.

 

[jfowkes]

Isnt Cost pressure eased if you slow down build so are chasing fewer construction workers/assets at any one time?

Immediate costs are reduced, but in simple terms, if you employ 10 workers for two years at £30,000 per year with 5% annual wage increases in total you pay £615,000.
If you only employ 5 workers, but spread the work over 4 years at the same 5% inflation, you pay £646,519.

Same with lots of other costs. Construction inflation is outstripping inflation in other sectors so the effects are pronounced.

EDIT: what @HSTEd said.

 

[The Ham]

Hunt said in an interview yesterday that no decisions had been taken, but he admitted that HS2 costs were out of control, largely because of inflation.

Costs increasing due to inflation should be a non issue (although they are a bit due to construction inflation generally being higher - but that just highlights the folly of delaying as it'll only make that worse) as the government should be able to have a higher tax take as inflation increases (of cost of inflation is running very high it negatively impacts this).

Although that also doesn't really work unless pay is mostly keeping up with inflation - something which appears to not be happening for a lot of people; as a lot of inflation being linked to profits rather than pay.

 

[HSTEd]

Costs on HS2 aren't out of control because of inflation, if they are out of control it is because the project management has been about as good as that for Berlin Brandenberg airport.

 

[WatcherZero]

Isnt Cost pressure eased if you slow down build so are chasing fewer construction workers/assets at any one time?

You also put back the commencement of revenue generation which as financing will almost certainly be through borrowing means higher cumulative financing costs.
Think of it like the difference between a ten year and a twenty five year mortgage, the annual payments will be higher on the shorter mortgage but you end up paying far less in the long run.

 

[fishwomp]

You also put back the commencement of revenue generation which as financing will almost certainly be through borrowing means higher cumulative financing costs.
Think of it like the difference between a ten year and a twenty five year mortgage, the annual payments will be higher on the shorter mortgage but you end up paying far less in the long run.

Umm, and what revenue is expected. Hint - the current farebox is £135m for Birmingham Int and New St to Euston.

And then the operational cost of running and maintaining the line needs to be deducted from those fares .

You also get to defer paying for rolling stock, if your supplier and the contract have not been inked with a fixed date already. Oh.

 

[The Ham]

Costs on HS2 aren't out of control because of inflation, if they are out of control it is because the project management has been about as good as that for Berlin Brandenberg airport.

Genuine question, given that construction inflation is higher than general inflation - where does that sit? As cost increases outside of what's allowed for by the "2019 prices" or within it.

Also, there's the fact of the £100 million in extra design fees for Euston (about 5% of the cost overruns at Euston) which were generated by extra design works at the request of the government.

Whist I don't doubt that the project has been badly project managed, that goes for the government as well as those who are designing and building it.

Of course it's easy to (as an example) highlight that Euston is now double the cost expected, however that's only one element (and a very complex one) so whilst it may have gone up a lot, how is the wider project doing?

Looking at the last report it would appear that the doubling of Euston is against a backdrop of where the wider project has spend £1.8bn over budget. Combined that would set it at £4bn of the circa £5.5bn contingency. Whilst not ideal, not into the realms of exceeding the contingency yet.

That would be circa 75% of the contingency on about 50% budget spent so far. However that's arguably not a fair comparison as little of the overspend has actually been spent on the Euston site (unless it has and I'm double counting the £1.8bn contingency spent so far with some of the £2.2bn contingency required for Euston).

That's a very different comparison to HS2 has burnt through its contingency as the whole scheme is sufficiently over budget.

Euston was always going to be complex (read likely to be more expensive than allowed for), however other areas are likely to be fairly straightforward (read unlikely to be more expensive than allowed for). Overall the impact may not be that bad, however individual elements are likely to show very high costs.

For a scheme which isn't under the spotlight it wouldn't likely be picked up. Given the fact that there's some vocal opposition to it, it's no surprise that it's getting a harder time than other projects perhaps would. The government (with some with concerns about the cost) are likely to not be over the details and so jump up and down about something more than perhaps they should.

They then make matters worse by trying to make it cheaper, but in doing so adding more costs to the project (which may well reduce the overall costs, but means that the amount saved is reduced).

 

[camflyer]

Rachel Reeves for Labour also refusing to commit.

You can hear the screams coming from Burnham's office in Manchester.

 

[Chester1]

Costs on HS2 aren't out of control because of inflation, if they are out of control it is because the project management has been about as good as that for Berlin Brandenberg airport.

Berlin Brandenburg was 11 years late and 3.5x over budget. HS2 isn’t quite that bad!

 

[HSTEd]

Berlin Brandenburg was 11 years late and 3.5x over budget. HS2 isn’t quite that bad!

HS2 also hasn't opened yet!
Plenty of more time for ballooning budgets yet!

 

[ScottGallagher]

What is the plan now for the existing Euston station , just leave as is?

 

[SCDR_WMR]

What is the plan now for the existing Euston station , just leave as is?

Nothing is happening now on the existing station. The HS2 part is make safe and wait.

 

[The Ham]

Umm, and what revenue is expected. Hint - the current farebox is £135m for Birmingham Int and New St to Euston.

And then the operational cost of running and maintaining the line needs to be deducted from those fares .

You also get to defer paying for rolling stock, if your supplier and the contract have not been inked with a fixed date already. Oh.

Whilst the operation costs do need to be deducted, the lease costs do not (currently), as they are part of the HS2 construction budget. Given that the lease costs are about 1/3 of the costs of running rail services that's quite a saving. That's before you consider that you need fewer coaches to run the services to Manchester on HS2, when fully open, (even though each train is 16 coaches long) than the current 3tph services (assuming a mix of 9 and 11 coaches on a 1:2 ratio). That's less lease costs per passenger even without there being extra passengers (which given a 9 coach + an 11 coach is roughly the capacity of a 400m HS2 train, there's plenty of scope for more of).

(16+16+16)*3 hours = 144 coaches
(11+11+9)* 5 hours = 155 coaches
(Even a mix of 5*11 and 10*9 coaches would still require 145 coaches)

Staff costs are typically also 1/3 of costs, however due to the reduced number of staff needed to run the same number of services and the increased number of seats per driver meaning that increases in ticket sales is likely be "profit" rather than paying staff costs.

One other factor to consider is that HS2 was originally planned to run services beyond just London/Birmingham and so long as there's a connection to the WCML that allows it there'll be more ticket income than just London/Birmingham.

Also ticket income is one of the benefits to the government from building a railway. For example if there growth in the economy that increases the tax take. Taking if tax take, unless the government has zero rated all spending on HS2 for tax purposes there'll be a percentage which comes back to the government from taxes on the HS2 spending (and a whole load of indirect taxes from wider economy spending).

 

[matacaster]

Why not consider using 200m trains throughout? Provides significantly less extra capacity, but allows shorter platforms at ooc could use existing platforms at Euston or maybe other existing London stations and much reduced costs.
Do we really need to increase capacity as much as the full HS2 would provide? Or could we reduce existing commuter services on southern wcml to create freight capacity. Yes,sometimes some people would have to wait for the next service, but they have frequencies unheard of in much of the rest of the country

 

[Tezza1978]

Rishi Sunak has been told by David Cameron and Boris Johnson to drop plans to scale back HS2 amid warnings that a "mutilated" line would be "insanity" https://www.tomorrowspapers.co.uk/times-front-page-2023-09-23/

Interesting front page of tomorrow's Times. Also goes on to say that there are real splits in govt and the cabinet, with Michael Gove named as pushing hard for it to be built in full