Serious Fraud Off ice probes HS2 contracts
Troubled rail scheme in new crisis over whistleblower’s ‘ lethal’ dossier
THE Serious Fraud Office is probing the HS2 project after being handed a bombshell dossier of documents leaked by a whistleblower, The Mail on Sunday can reveal.
Investigators are understood to be examining allegations of corruption in the way some contracts may have been awarded to suppliers.
They are also examining claims that some homeowners and businesses on the route of the train network linking London and Birmingham with cities in Northern England may have been swindled out of large sums of money by being forced to sell up for unrealistically low prices.
A source with knowledge of the inquiry last night said SFO officials are ‘deadly serious’
‘Good people at HS2 have no wish to be tarred with this’
about getting to the bottom of the claims. They interviewed a major property owner for two hours last Wednesday after he also made a string of allegations about HS2 and are poring over documents leaked by a former senior HS2 executive.
‘They (the SFO) are deadly serious and they have got documents that came from a former executive. The stuff is lethal,’ said the source. ‘There are a lot of very good people in HS2 who feel their professional abilities have been impugned, their advice has been ignored and they have no wish to be tarred with this shambles that is about to break.’
The probe has sent shockwaves through the Department for Transport a nd is t hought t o have increased the likelihood that Ministers will pull the plug on the controversial scheme.
Meanwhile, The Mail on Sunday understands:
● Boris Johnson beli eves t he project is ‘out of control’ and wants to ‘kill it’, according to Government sources, but is concerned about a potential electoral backlash in northern England;
● Ministers were horrified when told the project’s costs had ballooned from £56 billion to between £86 billion and £88 billion;
● Officials are investigating claims that some HS2 officials knew the cost had soared above £80 billion as long ago as December 2016;
● A major clearout of failing HS2 bosses is expected.
The Government last week ordered a review of HS2. A decision on its fate due by the end of the year. The review panel, which will be chaired by civil engineer Doug Oakervee, a former chairman of HS2, will meet for the first time this week. It will consider whether billions can be saved by lowering the speed of the trains, starting construction of the scheme in the North or building only the first leg between London and Birmingham.
One option will be to abolish HS2 Ltd, the Government-owned company managing the project, and shelve the scheme until Ministers decide whether it can be dramatically remodelled or should simply be axed.
One insider claimed that HS2’s chairman Allan Cook discovered earlier this year that by December 2016, the scheme’s costs had already ballooned to between £86 billion and £88 billion. The discovery apparently sparked panic in Whitehall due to fears that Ministers and officials may have inadvertently misl ed Parliament by saying t he project remained within its £56 billion budget.
Many in Downing Street are now convinced that HS2 cannot be saved but Mr Johnson wants to finalise an alternative major transport package for northern England, including a new rail line across the Pennines, before it i s canned. ‘Boris wants to kill it. It’s out of control financially,’ said a Government source. ‘But he has got to keep the Northern Powerhouse together. He has got to find a way of giving the North goodies.’
An SFO spokesman said: ‘We are aware of these allegations, but can neither confirm nor deny interest in the matter.’
HS2 last night said it had not been contacted by the SFO ‘or informed that any investigation is under way’. A spokesman added: ‘ Last year, the National Audit Office undertook a very detailed review of a series of allegations relating to our property cost estimates, and found nothing untoward. ‘In the last three years we have moved mo a long way as a project and organisation.’
About £7.4 billion has already been spent on HS2, mainly on buying up property and on preparatory p work. Figures released last year under Freedom of Information laws la revealed HS2 was paying p 318 officials at least le £100,000 in salary and an perks, up from 155 officials of in 2015/16.
A total of 112 staff were receiving more than £ 150,000 a year. Transport Secretary Grant Shapps last week said the Government is under no obligation to ‘keep ploughing money’ into the project’.
The first phase of the project between London and Birmingham is due to open at the end of 2026, with the second phase to Leeds and Manchester scheduled for completion by 2033.