Labour considers HS2 North replacement as mayors talk of £70bn growth

Labour mayors have urged Sir Keir Starmer to commit to replacing HS2 in the budget to deliver up to £70bn a year of economic growth to the West Midlands and Greater Manchester.

A new report published on Friday sets out proposals to build a new section of the HS2 line between Birmingham and Manchester. It says the section will generate £24 billion in extra revenue for the Treasury and provide much-needed capacity on one of Europe’s busiest rail lines.

The study was commissioned by the West Midlands and Greater Manchester councils following Rishi Sunak’s decision to scrap the northern section of HS2 last year, and has been described as a “golden opportunity” for the new government.

According to the analysis, a 50-mile (80km) Midlands-North West rail link could be built between the two cities, delivering 85% of the benefits of the cancelled second phase of HS2, for 60-75% of the costs, while delivering billions of dollars of additional growth to regional economies.

The plans, drawn up by a private consortium led by engineering giant Arup, propose a new rail link along the same route as HS2 phase 2, but with a lower specification and in stages to reduce cost.

Ultimately, if the replacement were built, it would involve slower train speeds than those planned for HS2, and would have to rely heavily on private finance to mitigate the impact on the Treasury.

The project’s promoters said that “its inclusion in the next budget would be welcomed by mayors and the private sector consortium” as it will allow work on a feasibility study to begin “immediately”.

The group’s economic assessment claims that the economies of the West Midlands and Greater Manchester could be £40bn to £70bn greater if connectivity were improved through a new rail link, and if they performed at the same level as the UK average or in line with comparable cities in Europe, such as Lyon in France or Dusseldorf in Germany.

It is estimated that the original plans for HS2 could have doubled the economic output of Manchester alone by £132bn.

Trains on the proposed route would run at around 185mph, slower than the 225mph of HS2 trains running between London and Birmingham. However, the report says journey times between London and Manchester would be just 15 minutes slower than HS2’s original proposals – and 30 minutes faster than current times.

Sir David Higgins, former chairman of HS2 Ltd and author of the report, said: “What we need now is for the new government to work with business and the combined authorities to take the practical steps to make this new rail link a reality.”

Ministers have ruled out reversing the cancellation of HS2 phase two but said they were prepared to consider any proposals drawn up for a replacement line.

Industry sources said I They believed the replacement was “very important” in Transport Secretary Louise Haigh’s agenda.

“It is clear that they understand, and particularly the railways minister Lord Hendy, that it is impossible to run an HS2 train to Manchester via the West Coast Main Line without very costly and disruptive upgrades. So they have to find a solution, and some form of new line is not being ruled out,” the source said.

To give further impetus to the initiative, the King’s Speech said the government wanted to “close the productivity gap in the North of England by transforming rail connectivity between the region’s economic centres through transformative infrastructure investment”.

The report does not provide an estimate of the cost of the new project, but says funding is expected to be “maximised by the private sector”, with central and local governments “partnering to finance the balance”.

She is calling on the government to bring together a group of global investors to provide private finance, as is happening in France and Spain, and as was used for the HS1 project almost 20 years ago.

Costs are expected to be lower because slower trains can use simpler connections to the existing rail network. Further savings could be made by using traditional ballasted tracks, rather than the more expensive concrete slab tracks needed for high-speed trains.

The report says the proposal will also “save the taxpayer £2 billion in costs” associated with cancelling HS2 phase 2 by reusing much of the land, powers and design work already secured with public funds.

Andy Burnham, Mayor of Greater Manchester, warned that a failure to address rail capacity and connectivity issues between the North and the Midlands would create “major barriers to economic growth in the UK”.

He added: “Doing nothing is not an option as demand for rail services on the West Coast Main Line is expected to exceed capacity within a decade.

“We stand ready to work with government, our West Midlands colleagues and the business community to build a rail network fit for the 21st century. But we must make decisions quickly to end uncertainty.”

West Midlands Mayor Richard Parker added: “Extra rail capacity to and from the North is vital for the West Midlands. It’s not just about faster journeys; it’s about connecting people, communities and businesses to jobs and opportunities.”

Andy Street, the former Conservative mayor of the West Midlands who was the driving force, said I:”When Andy Burnham and I were faced with the innards of HS2, we commissioned this work and I’m proud that we chose not to just accept the decision and say something has to be done.

“The big challenge (for mayors) is to persuade the new government – ​​which, to be fair to them, has not raised the immediate issue of cancelling HS2 – that the option of doing nothing is not acceptable.”

The government has been contacted for comment.