Work on delivering high-speed rail between London and Birmingham has already overspent – as pressure is applied to reduce its £42.6 billion budget.
Structural and design services to build up to the high speed rail link is set to cost 18 per cent more than expected after it emerged all four contracts were over budget, meaning it is running at £69.3 million rather than the projected £58.7 million.
Arup, which is delivering environmental assessments and the civil and structural design services for the Birmingham Curzon Street station is £3.1 million over budget on the scheme.
Campaigners believe this is an early signal that the costs of developing the giant infrastructure project will get out of hand, but the firm delivering HS2 says costs are under control and the extra spend was down to a demand for more detailed environmental assessments.
Beth West, HS2 commercial director, said the firm was determined to keep costs under control.
She added: “Additional detailed engineering design and environmental assessments have been required in order to develop a robust environmental statement and to assess thoroughly the environmental impacts of the HS2 route.”
It has emerged that all of the firms feeding into the first lot of work for HS2 are over budget.
A report in Building Magazine shows Arup is £1.6 million over for work at London Euston, Mott Macdonald has overspent by £1.2 million elsewhere in London, Southern contractor Atkins is over by 0.4 per cent and a Capita and Ineco joint venture is 42 per cent over for the northern part of the line.
Prime Minister David Cameron has recently said he wants Sir David Higgins, the former boss of the London Olympics to drive costs down when he starts at HS2 next year.
The £42.6 billion includes a contingency fund and Whitehall is optimistic the 351-mile network from London to Leeds and Manchester via Birmingham will be built for less.
The cost has become a divisive issue, which threatens to hit vital cross-party support for the scheme. While Labour leader Ed Miliband has said he backs HS2, shadow chancellor Ed Balls has piled on pressure over the budget, and is reported to have compared the scheme to the Millennium Dome.
Stop HS2 Campaign Manager Joe Rukin said: “We have always said that there is only one way which the costs for HS2 will go, and that is up, because so far ever single figure involved in HS2 has been pulled out of the air.
“Everyone knows that Government projects go massively over budget, and the Government think we will be filled with confidence because they have appointed someone with a track record of overseeing escalating costs to get the costs of HS2 down.”
The estimated cost of the project has risen from £34.2 billion to £42.6 billion, and there would be a further £7.5 billion cost of rolling stock.
In response to a rising tide of concern over the bill for HS2 – which is expected to create thousands of jobs in the West Midlands, businesses which stand to benefit have pledged to deliver under budget.
The open letter in September, which was signed by the heads of Laing O’Rourke, Arup, Atkins, Skanska, Balfour Beatty, Mott Macdonald and Kier stated: “We gladly accept the challenge of completing phase one of HS2 on schedule – and for less than the Government’s target of £17.16 billion.
“Funding secured for HS2 rightly includes a contingency – a responsible way to plan a project on this scale, yet artificially inflated figures circulated by opponents recently in no way represent the outcome we expect.”
The scheme aims to have trains running at 250mph between London and Birmingham from 2026, with branches to Manchester and Leeds via Sheffield planned for 2033.