CPA Bulletin

24 CPA Bulletin > May 2023 www.cpa.uk.net The recent news that the project would be delayed for up to two years, despite reassurances from the Chancellor Jeremy Hunt only in January that the government was committed to its delivery, was disappointing to say the least. As we cited in our Budget submission to the Treasury, failure to commit to HS2 will undermine confidence in the construction sector, placing doubts towards future government plans. While acknowledging that inflation was pushing existing costs up, it is important to focus on the economic benefits that the scheme will bring. Domestically, the project is developing new skills for the construction workforce of the future, with new techniques, technologies and machinery being deployed, not just showcasing the very best in UK construction, but also acting as a driver of exports and specialist skills. The industry reaction to the decision to the delay of HS2 was swift and to the point. There are now doubts placed on its future long-term viability, a degree of inertia around the work that remains ongoing, and confusion towards what the final completed project will look like and the benefits it was meant to bring. John Armitt, the current chairman of the UK’s National Infrastructure Commission called on the government to ‘having decided to build it, we should get on and build it’. Lost in the announcement around HS2 was news relating to the Lower Thames Crossing project, the road tunnel linking Kent to Essex that is designed to alleviate congestion at the current Dartford Crossing. This is also going to be delayed for up to two years, with doubts now on whether it will ever actually get off the drawing board and become a reality. Short term savings inevitably mean longer term costs due to longer term price inflation, the rising cost of materials and services, and risk management considerations. Calling halt to work on a project once it has started undermines efforts to complete it in full. Under current plans, Euston is meant to be the London terminus for HS2, yet even this remains in doubt - despite the amount of enabling work and construction already taking place. Given the complexity and scale of HS2, it is impossible to simply stop a project and then restart it at a moment’s notice. It might be a cliché but it is true - companies need certainty, and stability - they need time to deploy resources and staff, especially on a project like HS2. When HS2 is finally completed in whatever form this takes, the long-term lesson shows that while, at least in the UK, you might want politics to stay out of infrastructure planning, it’s simply impossible to do so. But what does this mean for other infrastructure projects in the UK and their long term viability? Under successive governments over the last decade, the ‘Northern Powerhouse’ was cited as a means of empowering the north, giving power to local communities with funding to secure and develop new roads, transport links, houses and boost and encourage wider economic growth. If the proposals started to lose steam under the succession of prime ministers the UK has experienced over the last seven years, the COVID-19 pandemic forced policymakers to refocus effort and resources elsewhere. The Boris Johnson government rebranded element of these policies as ‘levelling up’, identifying and focussing on key regions and areas that were being left behind. We are now on our second Prime Minister since the end of the Johnson administration - where does this leave levelling up, the ‘Northern Powerhouse’ and wider infrastructure projects? A brief look at the Transport for the North website, shows a succession of reports and press releases citing the economic benefits of investment and infrastructure development. This is mirrored in comments from both Steve Rotherham and Andy Burnham, the Metro Mayor for Liverpool POLICY: 1 POLICY After HS2 - what next for big government infrastructure projects and housebuilding targets? In my last article - ‘A Year of Challenges and Opportunities for our Sector’ - published in the February 2023 issue of the CPA Bulletin, I looked at what we could expect this year to bring in terms of the political outlook and the economic situation. While citing construction as a driver of growth, I managed to avoid reference to one of the largest infrastructure projects in the UK for decades, namely HS2.