Northern rail scheme has ‘clear risk’ of exceeding £45bn budget, MPs warn

There is a “clear risk” that a major scheme to boost rail connections across northern England cannot be delivered within its £45 billion funding cap, MPs have warned.

A report by the Commons’ Public Accounts Committee (PAC) compared the development of Northern Powerhouse Rail (NPR) to the “lack of robust governance” in the early stages of HS2 which caused major problems.

NPR was first proposed in 2014 and was originally envisioned as a new line between Liverpool and Hull.

The Government announced in January that the scheme would be delivered in three stages, with a funding cap of £45 billion, which could be topped up by local contributions.

The first phase of the programme involves improved connections on existing lines on these routes: between Sheffield and Leeds; between Leeds and York; and between Leeds and Bradford.

The PAC said in its report it is not confident the Department for Transport (DfT) has “learned all the lessons from past failures” and noted that NPR “remains at an early stage despite more than 12 years of planning”.

It went on: “There is considerable uncertainty over scope, how the programme fits with other local and national transport plans and needs, and how the department will manage and deliver the rail improvements in practice.

“There is a clear risk that the department cannot deliver the full programme and benefits within its £45 billion funding cap.”

The report expressed concern that NPR “may face cost pressures from planning and biodiversity requirements”, and raised doubts over whether it will be able to avoid “expensive measures” such as “HS2’s costly bat tunnel”.

HS2 Ltd built a bat protection tunnel in Buckinghamshire costing more than £100 million as part of efforts to mitigate the high-speed railway’s environmental impacts.

Labour MP Clive Betts, deputy chairman of the PAC, said: “The Government’s growth strategy earlier this year signalled that there is still an appetite to finally deliver the transport infrastructure the North so badly needs.

“But the spectre of HS2 hangs over Northern Powerhouse Rail.

“Our committee has heard troubling echoes of the same mistakes in loose governance that HS2 made early on, and so much of the project remains almost impressionistic, 12 years on.”

He added that the decision to use representatives from HS2 to develop NPR “does not fill us with confidence” as the former “has been a casebook example of how not to run a major project”.

A Department for Transport spokesperson said: “NPR will not repeat the mistakes of HS2 which is why we accepted all the recommendations of the James Stewart Review and are taking a disciplined, phased approach, completing detailed technical work with all stakeholders before fixing precise choices for major infrastructure.

“Since announcing NPR in January, we have worked closely with Mayors to take the project forward.

“New joint partnership forums are already overseeing the next stage of development and Network Rail has begun developing engineering designs.”