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The government has announced the construction of sections of HS2 will be delayed by two years to save money.

The high-speed railway was initially set to link London and the West Midlands with a further phase extending to cities in the North.

However, Transport Secretary Mark Harper said on Thursday: “We have seen significant inflationary pressure and increased project costs, and so we will rephase construction by two years, with an aim to deliver high-speed services to Crewe and the North West as soon as possible after accounting for the delay in construction.”

The delay will affect the northwest section of HS2, from Birmingham to Crewe, and then from Crewe to Manchester.

In a written ministerial statement, Mr Harper said the government is “prioritising HS2’s initial services” between Old Oak Common in west London and Birmingham Curzon Street.

Hs2 map
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The delay will affect the northwest section of HS2, from Birmingham to Crewe, and then from Crewe to Manchester.


On delivering services to central London, he also hinted at delays, saying: “We will address affordability pressures to ensure the overall spending profile is manageable.

“We will therefore take the time to ensure we have an affordable and deliverable station design, delivering Euston alongside high-speed infrastructure to Manchester.”

A planned extension to Leeds was already shelved in November 2021.

Labour said the latest delay meant the North was again having to “pay the price” for government failures.

Louise Haigh, the shadow transport secretary, said: “Tens of thousands of jobs, and billions in economic growth are dependent on this project.

“The North is yet again being asked to pay the price for staggering Conservative failure.

“Conservative chaos and chronic indecision is holding back jobs, growth and costing the taxpayer.

“This is the biggest project in Europe and delays pile costs up in the long run – ministers now need to come clean on precisely how much their indecision will cost taxpayers and the North.”

Raising a point of order in the Commons, Labour MP Sarah Owen also attacked Mr Harper for “avoiding scrutiny”.

She said the cabinet minister “should have had the decency to come to this House and explain to members why they are doing this” instead of publishing a written statement “at nearly 5 o’clock on Thursday afternoon”.

Commons speaker Lindsay Hoyle also criticised the way the delay was communicated, with his spokesperson saying: “The Speaker has consistently told the government that major policy announcements should be made to the House first so that members have the chance to ask questions on behalf of their constituents, rather than hearing about them via the media.”

Delay ‘could lead to higher costs’

Delivery of the high-speed railway has been a core pledge of the Conservative government but it has been plagued by delays and ever-increasing costs – from estimates of about £33 billion in 2010 to £55.7bn for the whole project in 2015.

By 2019, the estimated cost had soared to at least £71bn, excluding the final eastern leg from the West Midlands to the East Midlands.

Ministers are understood to be delaying construction of the northern section in the hope they can spread the cost over a longer period of time so it was more affordable annually.

Chancellor Jeremy Hunt is set to announce his spring budget next week and will have Rishi Sunak’s target in mind – to get government debt to fall as a percentage of GDP within five years.

HS2 :'Just give us the facts' Transport Secretary
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The high-speed trains were set to go from London Euston to Birmingham and up to Crewe and Manchester

However, the Confederation of British Industry (CBI) said the delay would hit confidence in the rail industry and could ultimately lead to higher overall costs for HS2.

John Foster, the CBI’s policy unit programme director, said the news “will ultimately reduce investor and contractor confidence in the rail sector”.

“To mitigate further loss of confidence, it is critical that government tackles the inflationary pressures which are biting hard across the infrastructure sector,” he said.

“Delays to projects may create short-term savings, but they can ultimately lead to higher overall costs and slow down the UK’s transition to a better, faster and greener transport network.”

HS2 a ‘colossal mistake’

Leader of Birmingham City Council, Ian Ward, said the delay is “another betrayal of the Midlands and the North, making a mockery of the government’s empty promises to level up the UK economy”.

But Conservative MP and former chief secretary to the Treasury Simon Clarke said delaying construction “would be a sensible decision”.

“Having observed HS2’s progress as chief secretary, I have serious doubts as to value for money and cost control,” he said.

Greg Smith, the Conservative MP for Buckingham, called for the government to “accept the whole thing was a colossal mistake and scrap it, all of it”.

Just last week, rail minister Huw Merriman told the Commons the government is “absolutely committed” to delivering HS2 but admitted “cost pressures” must be examined.

HS2 Ltd chief executive Mark Thurston said the project had suffered a “significant” impact from increased costs in building materials, fuel and energy due to high inflation.

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HS2 unearths unexpected treasure

HS2 is Britain’s biggest infrastructure project and has had support from governments of all stripes since it was first mooted more than a decade ago.

But last month, the government reportedly planned to make drastic changes that would almost halve the number of high-speed trains per hour and services would travel slower to save money.

Handout photo dated August 2022 issued by HS2 of a aerial view of the HS2 Euston station construction site in London.
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Aerial view of the HS2 Euston station construction site in London

The Department for Transport (DfT) said at the time it “does not comment on speculation” and said the government “remain committed to delivering the project”.

In January, Chancellor Jeremy Hunt said he did not see “any conceivable circumstance” in which the original plan would not be followed after reports the high-speed line could stop before reaching central London.

There were claims the last leg of HS2 into Euston could be scrapped and replaced with a new hub at Old Oak Common in the suburbs of northwest London, where it is set to stop before travelling into Euston.

The government did not deny the reports or that a two to five-year delay to the entire project – currently due to be completed between 2029 and 2033 – was being considered due to record high inflation impacting costs.

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Ticket re-sales could be capped under crackdown on touts

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Ticket re-sales could be capped under crackdown on touts

The price of resale tickets could be capped under plans to stop the public being “fleeced” by professional touts, the government has announced.

The limit could range from the cost of the original ticket to a 30% uplift, with a consultation to be launched on the specifics of the measure.

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Restricting the number of tickets resellers can list to the maximum they are allowed to purchase on the primary market is another option being considered.

The proposed changes come after concert sales for artists including Taylor Swift were marred by professional touts reselling at heavily inflated prices.

Others have been caught out by a lack of transparency over the system of dynamic pricing, which left Oasis fans watching the cost of some standard tickets more than double from £148 to £355 as they waited in the queue.

Ministers have already promised a dynamic pricing review, with the latest measures aimed at stopping touts “hoarding tickets and reselling at heavily inflated prices”, the culture department said.

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There has long been concerns about rip-off ticket resales for events, with high-profile artists like Ed Sheeran pushing for more regulation.

According to analysis by the Competition and Markets Authority (CMA), typical mark-ups on tickets sold second hand are more than 50%, while investigations by Trading Standards have uncovered evidence of seats going for up to six times their original price.

Singer Ed Sheeran appears on NBC's "Today" show at Rockefeller Center in New York, U.S., June 6, 2023. REUTERS/Brendan McDermid
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Ed Sheeran has campaigned for a crackdown on touts. Pic: Reuters

Last year, Virgin Media O2 estimated that ticket touts cost music fans an extra £145 million per year.

The proposals announced today will apply to music concerts, as well as live sport and other events, delivering on a Labour manifesto commitment to make the system fairer.

DJ Fatboy Slim said it was “great to see money being put back into fans pockets instead of resellers” and he is “fully behind” the proposals.

Dame Caroline Dinenage, the chair of the Culture, Media and Sport Committee, said the proposals “would go some way to help address the perverse incentives that are punishing music fans”.

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However she urged ministers to go further and launch a fan-led review of music, to look at how the industry could better support struggling small venues and fledgling artists.

Other proposals under the ticket tout crackdown include new obligations so that resale platforms are legally responsible for the accuracy of what is advertised by third parties on their sites.

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‘Dynamic pricing’: What can be done?

Professional sellers often advertise false information about their identity or key details of the ticket, especially for events where the organiser has imposed restrictions on re-sales, a report by the CMA in 2021 found.

The watchdog has also raised concern about “speculative selling” – when touts advertise seats they haven’t yet bought, cash in on the proceeds upfront and hope to secure a ticket later to fulfil the order.

The government also wants to bring in stronger fines and a new licensing regime for re-sale platforms to increase enforcement of protections for consumers.

Trading Standards can already issue fines of up to £5,000 for ticketing rule breaches and the consultation will look into whether this cap should be increased.

Culture Secretary Lisa Nandy said: “The chance to see your favourite musicians or sports team live is something all of us enjoy and everyone deserves a fair shot at getting tickets – but for too long fans have had to endure the misery of touts hoovering up tickets for resale at vastly inflated prices.

“As part of our Plan for Change, we are taking action to strengthen consumer protections, stop fans getting ripped off and ensure money spent on tickets goes back into our incredible live events sector, instead of into the pockets of greedy touts.”

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What’s going on in the markets and should we be worried?

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What's going on in the markets and should we be worried?

The chancellor is under pressure because financial market moves have pushed up the cost of government borrowing, putting Rachel Reeves’ economic plans in peril.

So what’s going on, and should we be worried?

What is a bond?

UK Treasury bonds, known as gilts because they used to literally have gold edges, are the mechanism by which the state borrows money from investors.

They pay a fixed annual return, known as a coupon, to the lender over a fixed period – five, 10 and 30 years are common durations – and are traded on international markets, which means their value changes even as the return remains fixed.

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That means their true interest rate is measured by the ‘yield’, which is calculated by dividing the annual return by the current price. So when bond prices fall, the yield – the effective interest rate – goes up.

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And for the last three months, markets have been selling off UK bonds, pushing borrowing costs higher. This week the yield on 30-year gilts reached its highest level since 1998 at 5.37%, and 10-year gilts briefly hit a level last seen after the financial crisis, sparking jitters in markets and in Westminster.

Why are investors selling UK bonds?

Bond markets are influenced by many factors but the primary domestic pressure is the prospect of persistent inflation, with interest rates staying high for longer as a consequence.

Higher inflation reduces the purchasing power of the coupon, and higher interest rates make the bond less competitive because investors can now buy bonds paying a higher rate. Both of which apply in the UK.

Inflation remains higher than the Bank of England‘s 2% target and many large companies are warning of further price rises as tax and wage rises bite in the spring.

As a result, the Bank is now expected to cut rates only twice this year, as opposed to the four reductions priced in by markets as recently as November.

Nor is there much optimism that the economic growth promised by the chancellor will save the day in the short term, with business groups warning investment will be tempered by taxes.

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Sky News’ Ed Conway on the impact of increased long-term borrowing costs as they hit their highest level in the UK since 1998

Is the UK alone?

No. Bond markets are international and in recent months the primary influence has been rising borrowing costs in the US, triggered by Donald Trump’s re-election and the assumption that tariffs and other policies will be inflationary.

The UK is not immune from those forces, and other European nations including Germany and France, facing their own political gyrations, have seen costs rise too. (The US influence could yet increase if strong labour market figures on Friday reinforce the sense that rates will remain high).

But there are specific domestic factors, particularly the prospect of stagflation. The UK is also more reliant on overseas investors than other G7 nations, which means the markets really matter.

Why does it matter to Reeves?

The cost of borrowing affects not just the issuance of new debt but the price of maintaining existing loans, and it matters because these higher costs could erode the “headroom” Ms Reeves left herself in her budget.

Headroom is a measure of how much slack she has against her self-imposed fiscal rule, itself intended to reassure markets that the UK is a stable location for investment, to fund day-to-day spending entirely from tax revenue by 2029-30.

At the budget, she had just £9.9bn of headroom and some analysts estimate market pressure has eroded all but £1bn of that.

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At the end of March the Office for Budget Responsibility will provide an update on the fiscal position and market conditions could change before then, but if they don’t then Ms Reeves may have to rewrite her plans.

The Treasury this week described the fiscal rules as “non-negotiable”, which leaves a choice between raising taxes or, more likely, cutting costs to make the numbers add up.

Why does it matter to the rest of us?

Persistently higher rates could push up consumer debt costs, increasing the burden of mortgages and other loans. Beyond that, the state of the economy matters to all of us.

The underlying challenges – persistent inflation, stagnant growth, worse productivity, ailing public services – are fundamental, and Labour has promised to address them.

Investment in infrastructure and new industries, spurred by planning and financial market reform, are all promised as medium-term solutions to the structural challenges. But politics, like financial markets, is a short-term business, and Ms Reeves could do with some relief, starting with helpful inflation and growth figures due next week.

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RMT union boss Mick Lynch announces retirement

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RMT union boss Mick Lynch announces retirement

Mick Lynch, one of the UK’s most influential union leaders in recent history, has announced he is retiring.

Mr Lynch is stepping down from the helm of the RMT (Rail Maritime and Transport Workers) union aged 63.

He served as general secretary since 2021.

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Under his leadership, the union waged years of strike action over pay and conditions before accepting a deal with the new Labour government this summer.

The rail strikes by RMT members were part of the wave of industrial action that meant 2022 had the highest number of strike days since 1989.

Walkouts began in June 2022 and did not officially conclude until September 2024.

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“It has been a privilege to serve this union for over 30 years in all capacities, but now it is time for change,” Mr Lynch said.

He will remain in post until a successor is appointed in May, the RMT said.

Why’s he retiring?

No reason was given for his departure but Mr Lynch said there was a need for change and new workers to fight.

“There has never been a more urgent need for a strong union for all transport and energy workers of all grades, but we can only maintain and build a robust organisation for these workers if there is renewal and change,” he said.

“RMT will always need a new generation of workers to take up the fight for its members and for a fairer society for all”.

A career of organising

Mr Lynch first joined the RMT in 1993 after he began working for Eurostar. Before being elected secretary general at the top of the organisation he worked as the assistant general secretary for two terms and as the union’s national executive committee executive, also for two terms.

As a qualified electrician, Mr Lynch helped set up the Electrical and Plumbing Industries Union (EPIU) in 1988, before working for Eurostar and joining the RMT.

He had worked in construction and was blacklisted for joining a union.

“This union has been through a lot of struggles in recent years, and I believe that it has only made it stronger despite all the odds,” Mr Lynch said.

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