Reports have emerged indicating that the UK Government is planning to revive the original HS2 plans, extending the high-speed rail route from London Euston to Crewe. Initially intended to connect London, Birmingham, Manchester, and Leeds, the project’s Phase 2, leading to Crewe, had been abandoned by the previous administration. However, Labour leader Keir Starmer is allegedly preparing to reverse this decision regarding ‘Phase 2a’, as it already has parliamentary approval. This resurrection of the route will see the line extend from the capital beyond Birmingham to Crewe. The construction will not be overseen by HS2 Ltd but rather by a private sector consortium.
The estimated cost of Phase 2a in 2015 was around £3.72 billion, which would equate to roughly £5 billion today. The financial implications for Wales have been a point of contention, as it was categorised as an “England and Wales” scheme, thereby bypassing the Barnett Formula. This decision has reportedly cost Wales significant funding opportunities. The cancellation of parts of HS2 by former Prime Minister Rishi Sunak further exacerbated this issue. Plaid Cymru had estimated the losses at £4 billion, though Wales’ then finance minister, Rebecca Evans, later clarified it to be £350 million.
Calls to re-evaluate HS2’s funding classification have persisted, especially following Labour’s victory in the general election. Despite assurances from the Treasury that there will be no reconsideration of funding allocations to Wales, Welsh leaders, including First Minister Eluned Morgan and Finance Minister Mark Drakeford, maintain their position on seeking equitable funding. In a move to divert resources, former Prime Minister Rishi Sunak scrapped the remaining HS2 routes and pledged to allocate the saved £36 billion to other transport projects. One such pledge involved £1 billion for the electrification of the north Wales rail line, although progress on this initiative remains unclear.
As discussions on the revitalisation of HS2 continue, the ramifications of this decision on Wales and its financial interests remain a focal point of debate and negotiation.