HS2 Executive Chairman Sir Jon Thompson says a ‘systemic problem’ for infrastructure projects such as his is that budgets are set at a point where costs estimates are immature.
Speaking at the Transport Select Committee on 10 January about cost rises, he said the initial budget was set too low, that there were changes to scope, some ‘poor delivery’ and inflation. ‘The situation with HS2 is, in my opinion, that the estimate was poor, the budget was set too early and then, when you get further into it, you get much better information. Then, on that basis, you can cost it out with more accuracy, and then you discover it’s higher.’
He pointed out that since the railway was originally launched, much more of it is now in tunnels than originally planned, adding to costs. On total costs, Sir Jon told the committee that inflation would add between £8 billion and £10 billion to the 2019 prices of between £49 billion and £56.5 billion. He highlighted price rises of around 50% in the cost of steel, rebar and concre…
