HS2 has already cost us £2.3bn (without any tracks being laid!)
HS2 has already cost taxpayers almost £2.3billion before a single piece of track has been laid, it emerged yesterday.
The spiralling cost of Britain’s biggest ever infrastructure project was revealed in accounts slipped out yesterday afternoon.
The annual report showed that the company, established by the government to build the railway, spent £500million in the year to March 31 – up almost 30 per cent from £352.9million the year before. It takes the total amount spent by HS2 so far to more than £1.9billion since 2009.
Separate accounts published by the Department for Transport yesterday also showed it has spent another £366million on HS2. The bulk of this was on compensating individuals and businesses who own property and land near the planned line.
This takes the total amount spent on the project to just under £2.3billion. It comes amid fresh warnings that the project could end up costing more than £100billion. Last year’s spending splurge included almost £1.8million in unauthorised redundancy payments to staff, which has landed the project in hot water with the government spending watchdog.
As well as the six-figure salaries of bosses – including £550,000 for its new boss Mark Thurston – vast amounts of money are being spent on an army of consultants, lawyers and PR companies.
The DfT revealed earlier this year that HS2 Ltd had spent millions on 17 PR agencies and consultants. More than £230million was spent on ‘professional services’ firms, which includes engineering contractors but also includes fees charged by the 17 public relation companies and consultants on its payroll. More than £7million was spent on licences and surveys, £2.4million on lawyers and £2.2million on recruitment fees.
Yesterday’s HS2 report came on the same day as the BBC released the figures of its top paid employees’ salaries. Last night one MP described the rail link as a ‘gravy train’ which has companies ‘foaming at the mouth’.
The accounts revealed the huge costs of employing HS2’s rapidly expanding workforce.
A wage bill of almost £88million was shared among 1,292 people, including 927 direct staff and 365
‘Foaming at the mouth’
contractors. Direct staff earned an average of £67,900 – more than two and a half times the average salary in the UK. The top earning directors included finance chief Steve Allen, who was paid £415,000, former chairman Sir David Higgins who received £240,000, and former chief executive Simon Kirby, who received £ 574,038 of his £ 750,000 salary because he left in December. New chairman Roy Hill received £242,495 for less than three months’ work.
Cheryl Gillan, MP for Chesham and Amersham – who has been one of the most vocal opponents of HS2, said: ‘In the same way many people will be surprised about the revelations about pay at the BBC, they will be surprised at the exorbitant amounts paid at HS2.
‘When we start to look at the costs incurred you see why it was dubbed “gravy train” in the first place. Companies have been foaming at the mouth at such a generous public sector project which is too big to fail.’ Earlier this week Transport Secretary Chris Grayling dismissed warnings about spiralling costs and said the project was on track to meet its £55.7billion budget.
Preparatory work on building the first phase of the line between London and Birmingham began recently. A DfT spokeman said: ‘HS2 will become the backbone of our national rail network – creating more seats for passengers, supporting growth and regeneration and helping us build an economy that works for all.’
HS2 has also been reprimanded by the Government spending watchdog, after its accounts revealed it handed out £1.76million in unauthorised payoffs to staff who left the company. The National Audit Office said only £1million of the £2.76million in redundancy payouts was authorised.