Transport Secretary Heidi Alexander has promised a fundamental one-year reset for HS2 after admitting to Parliament that there was no way presently to deliver the project on schedule and to budget.
She slammed a litany of failures for wasting billions on the project, blaming bad management, constant changes and ineffective contracts with the supply chain.
She said: “Phase one could end up becoming one of the most expensive railway projects in the world.
“We have started the year-long task of fundamentally resetting the project.”
“As part of that reset, we have reduced financial delegations to HS2 Ltd, placing a lid on spiralling costs until the rest is complete and we regain confidence.”
The transport secretary also pledged to fully investigate allegations of fraud in the supply chain and prosecute if proven.
Alexander said: “There are also allegations that parts of the supply chain have been defrauding taxpayers.
“I have been clear these need to be investigated rapidly and vigorously. If fraud is proven, the consequences will be felt by all involved.
“I will provide updates to the House on progress with the HMRC investigation that is now underway.
“No stone will be left unturned in terms of getting to the bottom of this matter,” she said.
In a statement to Parliament, Alexander announced the appointment of Mike Brown, the former commissioner of Transport for London, to become the new chair of HS2 Ltd.
Brown previously worked with HS2 chief executive Mark Wild on Crossrail to turn around final delivery of the project.
The transport secretary published the James Stewart review and accepted all 89 recommendations for a capability and cultural overhaul.
She confirmed it would be several months before the HS2 chief executive would have a revised budget and completion date.
Alexander said: “HS2 will work with suppliers so their contracts incentivise saving costs for taxpayers. As far as I am concerned, suppliers should make a better return the more taxpayer money they save.”
She told MPs: “Today I’m drawing a line in the sand, calling time on years of mismanagement, flawed reporting and ineffective oversight.”
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