Rishi Sunak could announce a series of transport improvements for the north of England including bringing forward the high-speed link between Manchester and Leeds as he seeks to limit the political fallout over the future of HS2.
Government sources suggested the prime minister still planned to press ahead with a proposal to axe the Birmingham to Manchester link of HS2 despite a furious response and Tory fears that it would fatally undermine their commitment to levelling up.
However, the sources claimed that ministers were looking at boosting Northern Powerhouse Rail (NPR) at the same time, as well as providing more funding for bus services and trams in the region. “The different parts of it have to go hand in hand,” one said.
Senior rail industry insiders said it would be “madness” to cancel the multibillion-pound HS2 scheme. One told the Guardian that NPR would be “buggered” because it relied on the Manchester link of HS2, and claimed there was “nothing ready” in the government’s integrated rail review that could replace it.
Sunak could bring forward an announcement, originally pencilled in for around the time of the autumn budget, to as early as this week, although northern Tories have argued that scrapping the northern leg before their party conference in Manchester would be a major embarrassment.
However, government sources suggested that Sunak was unlikely to delay the project, after reports that the northern phase between Birmingham and Manchester could be put on ice by up to seven years.
With costs not expected to ramp up until the 2030s anyway, they said there would be little financial benefit in pausing the multibillion-pound project in order to move costs into a future parliament.
The defence secretary, Grant Shapps, had suggested on Sunday there could be a change to the “sequencing” and “pace” of HS2 from the government because of the soaring price tag, adding that it would be “crazy” not to reassess whether the full rail project remained viable.
But senior Conservatives believe that delaying the northern section would be out of kilter with Sunak’s attempts to make a virtue out of taking “bold” and sometimes controversial decisions, and to “free himself of some of Boris’s shackles”.
On Monday, Sunak twice dodged questions during an interview about whether the northern leg – from Birmingham to Manchester – would be built after all.
“I’m not going to comment on that type of speculation. But what I would say is: we’re absolutely committed to levelling up and spreading opportunity around the country, not just in the north but in the Midlands, in all other regions of our fantastic country,” he said.
The doubts comes after a chorus of warnings against any move to axe the project, with those speaking out including former prime ministers Boris Johnson and David Cameron, business leaders and the Labour mayors of Greater Manchester and London, Andy Burnham and Sadiq Khan.
Burnham, who warned that not modernising rail infrastructure in the north would be “a recipe for … a north south chasm”, appealed to Sunak in a joint-letter with the leader of Manchester city council to meet them before making any final decision on HS2.
Lord Adonis, the architect of HS2 for the last Labour government, told the Guardian: “ If the extension to Manchester is cancelled now, it will ultimately be restarted at far greater cost, because it is absurd to have a high speed line just from Acton to Birmingham which doesn’t serve the north.”
He said that Sunak appeared to be tempted to follow a report penned for the thinktank Policy Exchange in November 2022 by Andrew Gilligan, a former transport adviser who called for all parts of HS2 where construction has not yet started to be cancelled, and who was believed to be back informally advising the government.
“His argument was that so-called elites would complain, but that didn’t matter because the public didn’t care much either way. The deep cynicism is all there in Gilligan’s report” said Adonis.
But some Tories have argued HS2’s spiralling costs mean it should be trimmed, or the timetable for its full delivery pushed back. An initial cost of £33bn in 2010 has since soared to £71bn and is now feared to be closer to £100bn.
Greg Smith, a member of the Commons transport committee and a Tory MP for Buckinghamshire who has been vociferous critic of the entire project, told the Guardian he would be “deeply disappointed” if Sunak now went ahead.
“Government is now waking up and seeing that it’s unaffordable and that actually isn’t going to deliver that much value to the United Kingdom,” he said.
“Even with phase one of the project, isn’t it better to admit the mistake now and to have wasted £8bn than spend another £100bn and know this is a project that does not offer value?”
However, John Stevenson, the chair of the Northern Research Group of Conservative MPs, told the government it “cannot and must not” get rid of HS2.
Away from the political fray, Paul Johnson, the director of the influential Institute for Fiscal Studies, said HS2 was likely to be a “total waste” of money, and was always “obviously” going to be hugely expensive with relatively little gain.
“This whole thing, it just makes me want to weep. It just makes me despair. I mean, the original sin, as it were, was agreeing to do it in the first place,” he told Times Radio.
“It rather looks like we’re going to totally waste the money on this in producing a rail at the cost of tens of billions, which will get you from Birmingham to central London less quickly than you can do at the moment.”
