HS2: Labour mayors join forces to make plea for northern leg to PM

Published

2 years ago

September 27, 2023

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Five Labour mayors have come together to appeal to the prime minister not to scrap the northern leg of HS2, saying such a move would lead to “economic damage” across the regions.

The future of the high-speed rail line has been in doubt over recent days after reports Rishi Sunak and his Chancellor Jeremy Hunt were planning to cancel the line between Birmingham and Manchester due to soaring costs.

But in a joint statement London’s Sadiq Khan, Great Manchester’s Andy Burnham, West Yorkshire’s Tracy Brabin, South Yorkshire’s Oliver Coppard and Liverpool’s Steve Rotheram said that without delivering the project in full, the government would “leave swathes of the North with Victorian transport infrastructure that is unfit for purpose”.

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Mr Sunak did nothing to quell fears on Monday that he was preparing to either cancel or delay the line, and he has told allies he was not prepared to watch the cost continue to rise, according to The Times

The newspaper said he was concerned about a lack of cost controls and high salaries at the company overseeing the project after he was shown figures suggesting the overall price could top £100bn.

Mr Sunak is also said to be considering terminating the line in the west London suburb of Old Oak Common rather than in Euston, in the centre of the capital, to save money.

But the announcement, which had been expected ahead of the Conservative Party conference this weekend, has yet to surface.

In a statement released on Wednesday, the regional mayors said they had been “inundated” by concerns from businesses, and curtailing the line would mean HS2 would “fail to produce any meaningful economic benefit”.

“This government has said repeatedly that it is committed to levelling up in the Midlands and North,” they added.

“Failure to deliver HS2 and [Northern Powerhouse Rail] will leave swathes of the North with Victorian transport infrastructure that is unfit for purpose and cause huge economic damage in London and the South, where construction of the line has already begun.”

HS2 was first touted by Labour in 2009, but it was the coalition government that signed off on the plan, designed to connect the South, the Midlands and the North of England with state-of-the-art infrastructure.

If the Manchester leg is axed it would be the latest watering down of the project, with the eastern leg to Leeds scrapped entirely and work between Birmingham and Crewe delayed due to the impact of inflation.

Some estimates have put the total cost at over £100bn, while the project has been rated “unachievable” by the infrastructure watchdog.

But as they asked for a meeting with Mr Sunak, the mayors said: “The UK does not need a new line that only goes from Birmingham to Old Oak Common, which is six miles from central London. Birmingham does not want this. London does not want this. This does nothing for the North of England.

“The full Y-shaped HS2 plan was designed to deliver economic benefit right across the country not only between the North and London, but between Leeds, Sheffield, Manchester and Birmingham. All of these gains look set to be lost if media reports this week are to be believed.”

They added: “It has been suggested that around £25bn has already been spent on HS2. We agree on the importance of ensuring public money is well spent but it will be an international embarrassment and a national outrage if all this gets us is a line that leads to journeys slower than the current one between Birmingham and London and nothing more.”

But it isn’t just Labour politicians angered by the possible downscaling of the project.

Tory former chancellor George Osborne and ex-Conservative deputy prime minister Lord Heseltine were among grandees warning that scrapping the Manchester route would be a “gross act of vandalism” which would mean “abandoning” the North and Midlands.

And Norman Baker, a former Lib Dem transport minister who signed off HS2 during the coalition government, called for an inquiry into the chaos of the project “to make sure it doesn’t happen again”.

Asked by Sky News on Wednesday whether HS2 would be given the green light to go to Manchester, Culture Secretary Lucy Frazer said it was “a decision for the chancellor”.

She added: “I’m sure the prime minister and chancellor listen to a wide variety of voices, but as you will know, it is the responsibility of government to keep all projects under consideration.

“And that is what the chancellor is doing, as he has done on all matters which are spending billions of pounds of taxpayer funding, looking at a whole range of projects to make sure they are value for money.”

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South Korean court clears Wemade ex-CEO in Wemix manipulation case

Published

4 hours ago

July 15, 2025

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Is there £15bn of wiggle room in Rachel Reeves’s fiscal rules?

Published

5 hours ago

July 15, 2025

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Is there £15bn of wiggle room in Rachel Reeves's fiscal rules?

Are Rachel Reeves’s fiscal rules quite as iron clad as she insists?

How tough is her armour really? And is there actually scope for some change, some loosening to avoid big tax hikes in the autumn?

We’ve had a bit of clarity early this morning – and that’s a question we discuss on the Politics at Sam and Anne’s podcast today.

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And tens of billions of pounds of borrowing depends on the answer – which still feels intriguingly opaque.

You might think you know what the fiscal rules are. And you might think you know they’re not negotiable.

For instance, the main fiscal rule says that from 2029-30, the government’s day-to-day spending needs to be in surplus – i.e. rely on taxation alone, not borrowing.

And Rachel Reeves has been clear – that’s not going to change, and there’s no disputing this.

But when the government announced its fiscal rules in October, it actually published a 19-page document – a “charter” – alongside this.

And this contains all sorts of notes and caveats. And it’s slightly unclear which are subject to the “iron clad” promise – and which aren’t.

There’s one part of that document coming into focus – with sources telling me that it could get changed.

And it’s this – a little-known buffer built into the rules.

It’s outlined in paragraph 3.6 on page four of the Charter for Budget Responsibility.

This says that from spring 2027, if the OBR forecasts that she still actually has a deficit of up to 0.5% of GDP in three years, she will still be judged to be within the rules.

In other words, if in spring 2027 she’s judged to have missed her fiscal rules by perhaps as much as £15bn, that’s fine.

Now there’s a caveat – this exemption only applies, providing at the following budget the chancellor reduces that deficit back to zero.

But still, it’s potentially helpful wiggle room.

This help – this buffer – for Reeves doesn’t apply today, or for the next couple of years – it only kicks in from the spring of 2027.

But I’m being told by a source that some of this might change and the ability to use this wiggle room could be brought forward to this year. Could she give herself a get out of jail card?

The chancellor could gamble that few people would notice this technical change, and it might avoid politically catastrophic tax hikes – but only if the markets accept it will mean higher borrowing than planned.

But the question is – has Rachel Reeves ruled this out by saying her fiscal rules are iron clad or not?

Or to put it another way… is the whole of the 19-page Charter for Budget Responsibility “iron clad” and untouchable, or just the rules themselves?

And what counts as “rules” and are therefore untouchable, and what could fall outside and could still be changed?

I’ve been pressing the Treasury for a statement.

And this morning, they issued one.

A spokesman said: “The fiscal rules as set out in the Charter for Budget Responsibility are iron clad, and non-negotiable, as are the definition of the rules set out in the document itself.”

So that sounds clear – but what is a definition of the rule? Does it include this 0.5% of GDP buffer zone?

The Treasury does concede that not everything in the charter is untouchable – including the role and remit of the OBR, and the requirements for it to publish a specific list of fiscal metrics.

But does that include that key bit? Which bits can Reeves still tinker with?

I’m still unsure that change has been ruled out.

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LA sheriff deputies admit to helping crypto ‘Godfather’ extort victims

Published

6 hours ago

July 15, 2025

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