On HS2, there has been a failure to manage costs and a complete lack of transparency
The cost of HS2 has spiralled from a projected £27bn to £55bn for phase one to date, says Meg Hillier MP | Credit PA Images
No responsible government should be willing to see such huge cost escalations and so little accountability.
High Speed 2 is one of the largest and most complex infrastructure projects the country has attempted to deliver. It spans many years, a large geographical area and at its most optimistic will cost at least £65bn (2025 prices).
The Public Accounts Committee’s latest report has just highlighted concerns about the rising cost of this project.
We have been hampered in our work by the lack of transparency from government about the rising costs, underlining a ridiculous situation whereby the highly paid professional heads of Whitehall departments are unwilling to reveal problems and cost increases without the say so of their political masters.
Before the coronavirus pandemic No10 made noises about changing the way that Whitehall worked. A government with courage should also be bold enough allow a change in the way Parliament scrutinises big projects – by allowing us to look at a project at the planning stages.
Since I was first elected to chair the Public Accounts Committee, I have urged ministers to offer up projects for this kind of pre-scrutiny.
So often the problems of overspend and delay are a result of over optimism and poor planning at the early stages. It’s a weary reality the Public Accounts Committee has seen all this before and yet, Whitehall and government learns too slowly from its mistakes.
Officials can use political indecision and over optimism as an excuse and politicians can blame the civil service (remember Dominic Cummings and the “blob” – his term for the education establishment).
And so we end up with the orphan that is failure. And let’s be clear that the cost of this to the taxpayer is huge. The cost of Phase One of HS2 has spiralled from a projected £27bn to an estimated £31bn-£40bn to date (2015 prices). The National Audit Office cannot be sure of the final cost of construction but we know the current predicted range is between £65bn and £88bn.
In the light of the impact of Covid-19, the government will face some stark choices but it will be considering whether to invest in big infrastructure projects to boost the economy.
Any rational assessment of what to invest taxpayers hard earned money in will have to meet some key tests.
But too often ministers are seeking to drive through projects on a right political timetable and officials are not able to stand up and call out the unrealistic deadline because of the challenge of the political relationship.
On the basis of HS2, would the government see a Whitehall department as the best driver of major infrastructure investment?
If taxpayers’ money is used to boost investment and help economic recovery, it’s not enough to challenge a project once it’s gone wrong.
On HS2, we have seen a failure to manage costs and a complete lack of transparency when those closest to the project knew that the costs were escalating and chose not to tell the committee.
Every pound of taxpayer’s money saved is a pound to spend elsewhere. And in a post Covid world every tax pound will need to be well spent to get the economy growing again.
It’s for the Government to decide whether it will continue (although the go-ahead in March suggests it’s sticking to its promise to deliver). But no responsible government should be willing to see such huge cost escalations and so little accountability.
This issue is wider than just HS2. The Government says it wants to reinvent Government but we have to reinvent the scrutiny of Government alongside that.
The stakes are so high with the worst recession in a century looming. If taxpayers’ money is used to boost investment and help economic recovery, it’s not enough to challenge a project once it’s gone wrong.
Scrutiny that identifies problems and pitfalls early is not a nice to have option, but the flip side of the coin as the Government adapts to invest. The Public Accounts Committee stands ready.
Meg Hillier is Labour MP for Hackney South and Shoreditch and chair of the Public Accounts Committee
*This article has been updated to reflect the correct figures*