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The cost of building HS2 between London and Birmingham could reach nearly £67bn – almost double an early projection for the entire project to the north.

HS2 Ltd executive chairman Sir Jon Thompson told MPs the estimated cost for phase one stood between £49bn and £56.6bn based on 2019 prices – but adjusting the range for current prices would mean “adding somewhere between £8bn and £10bn”.

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The new estimate is nearly double what the high-speed network was expected to cost in 2013, when it had a price tag of £37.5bn.

That figure was based on 2009 prices for the entire planned network, including the routes from Birmingham to Manchester and Leeds which have now been scrapped.

Giving evidence to parliament’s Transport Select Committee, Sir Jon said the costs for phase one had jumped due to original budgets being too low, poor delivery and inflation.

He said there was a “systemic problem” where budgets are set out early “based on very, very immature data”.

“You don’t have a design, you haven’t procured anything, there is no detail on which you can cost anything,” he explained.

“But then you get into the detailed design, you know exactly how big it is, what surfaces you want, how much concrete needs to be poured. Unsurprisingly you get a better number.”

A general view of the HS2 construction site at Curzon Street in Birmingham city centre, Birmingham, Britain, October 3, 2023. REUTERS/Carl Recine
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The HS2 construction site at Curzon Street in Birmingham

Rishi Sunak took the controversial decision to scrap the northern leg of HS2 to Manchester at the Tory party conference in October, attracting criticism from regional leaders who branded it a “betrayal” of northern voters.

The prime minister promised to spend the billions of cash savings on hundreds of other transport schemes across the country instead, including a new Network North project to join up northern cities by rail.

The government was recently mocked after it emerged roads in London will be revamped as part of the project.

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A recent document published by the Department for Transport (DfT) which outlined plans for Network North stated the government believed phase one of HS2 should cost between £45bn and £54bn – and HS2 Ltd “should deliver at the lower end of this range”.

But Sir Jon told the committee: “It’s for the department and the government to decide what it wants to use that data for, but I do not believe that phase one could be delivered for £45bn.”

He also told the committee the decision to scrap HS2 north of Birmingham could lead to a reduction in seat capacity for train services between London and Manchester compared with today.

Louise Haigh, Labour’s shadow transport secretary, said: “This is a direct result of Rishi Sunak’s weak leadership and mismanagement of HS2.

“As chief secretary, chancellor and now PM Rishi Sunak has allowed costs to soar, and public money go down the drain.

“This is a government with no direction, no plan and no regard for taxpayers’ money.”

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Why Boris’s best mate is off to Reform

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Why Boris's best mate is off to Reform

👉Listen to Politics at Sam and Anne’s on your podcast app👈       

Former Conservative chairman and friend of Boris Johnson – Sir Jake Berry – is defecting to Reform UK, causing more problems for Tory leader Kemi Badenoch.

On today’s episode, Sky News’ Sam Coates and Politico’s Anne McElvoy discuss if his defection will divide parts of Reform policy.

Elsewhere, the Anglo-French summit gets under way, with Prime Minister Sir Keir Starmer hoping to announce a migration deal with French President Emmanuel Macron to deter small boat crossings.

Plus, chatter around Whitehall that No10 are considering a pre-summer reshuffle, but will it have any value?

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Australia to test CBDCs, stablecoins in next stage of crypto play

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Australia to test CBDCs, stablecoins in next stage of crypto play

Australia to test CBDCs, stablecoins in next stage of crypto play

The trial is part of Project Acacia, an initiative from the RBA exploring how digital money and tokenization could support financial markets in Australia.

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Starmer and Macron agree need for ‘new deterrent’ to stop small boat crossings

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Starmer and Macron agree need for 'new deterrent' to stop small boat crossings

Sir Keir Starmer and Emmanuel Macron have agreed the need for a “new deterrent” to deter small boats crossings in the Channel, Downing Street has said.

The prime minister met Mr Macron this afternoon as part of the French president’s state visit to the UK, which began on Tuesday.

High up the agenda for the two leaders is the need to tackle small boat crossings in the Channel, which Mr Macron said yesterday was a “burden” for both the UK and France.

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The small boats crisis is a pressing issue for the prime minister, given that more than 20,000 migrants crossed the English Channel to the UK in the first six months of this year – a rise of almost 50% on the number crossing in 2024.

Sir Keir is hoping he can reach a deal for a one-in one-out return treaty with France, ahead of the UK-France summit on Thursday, which will involve ministerial teams from both nations.

The deal would see those crossing the Channel illegally sent back to France in exchange for Britain taking in any asylum seeker with a family connection in the UK.

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However, it is understood the deal is still in the balance, with some EU countries unhappy about France and the UK agreeing on a bilateral deal.

French newspaper Le Monde reports that up to 50 small boat migrants could be sent back to France each week, starting from August, as part of an agreement between Sir Keir and Mr Macron.

A statement from Downing Street said: “The prime minister met the French President Emmanuel Macron in Downing Street this afternoon.

“They reflected on the state visit of the president so far, agreeing that it had been an important representation of the deep ties between our two countries.

“Moving on to discuss joint working, they shared their desire to deepen our partnership further – from joint leadership in support of Ukraine to strengthening our defence collaboration and increasing bilateral trade and investment.”

It added: “The leaders agreed tackling the threat of irregular migration and small boat crossings is a shared priority that requires shared solutions.

“The prime minister spoke of his government’s toughening of the system in the past year to ensure rules are respected and enforced, including a massive surge in illegal working arrests to end the false promise of jobs that are used to sell spaces on boats.

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“The two leaders agreed on the need to go further and make progress on new and innovative solutions, including a new deterrent to break the business model of these gangs.”

Chris Philp, the shadow home secretary, seized on the statement to criticise Labour for scrapping the Conservatives’ Rwanda plan, which the Tories claim would have sent asylum seekers “entering the UK illegally” to Rwanda.

He said in an online post: “We had a deterrent ready to go, where every single illegal immigrant arriving over the Channel would be sent to Rwanda.

“But Starmer cancelled this before it had a chance to start.

“Now, a year later, he’s realised he made a massive mistake. That’s why numbers have surged and this year so far has been the worst in history for illegal channel crossings.

“Starmer is weak and incompetent and he’s lost control of our borders.”

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