Greengauge 21 welcomes the release of the Terms of Reference for a study of options to complete HS2’s Eastern arm, while raising two concerns:
- The need to impart a greater sense of urgency: at current rates of progress, it is not easy to be confident that Leeds will gain HS2 services – which can provide the efficient zero-carbon transport network the nation needs – before 2050.
- The need to help future Chancellors of the Exchequer overcome the one-sided logic in the Terms of Reference which makes additional capital expenditure – i.e. infrastructure investment – contingent on how well the overall economy is growing, when in reality, of course, adding high-speed capacity is crucial to delivering economic growth.
The Terms of Reference indicate a new way of planning high-speed rail. Instead of thinking of HS2 as a free-standing project, its inter-connection with the existing rail network is clearly recognised as important. So, for example, the HS2 to Leeds Study is to include “understanding the optimal solution for capacity at Leeds station and any synergies with the West Yorkshire mass transit system.” This is indicative of a ‘whole network’ rather than a free-standing scheme approach. It is a prerequisite to adopting more cost-effective approaches to HS2 extensions.
This is a challenging but necessary change in approach to planning high-speed rail, and we welcome it.
Roles and Uncertainties
Primary responsibility is being given to Network Rail to take this on. To succeed, its team will need to look beyond Network Rail’s own infrastructure and its concomitant obligations. Perhaps it will be allowed a glimpse at the unpublished ‘Whole Industry Strategic Plan’ that the GBR Transition Team has no doubt developed by now. (Ref 1) They can also call on HS2 Ltd for help, but with the Government’s delay-go-stop-restart approach to the existing project, they are busy enough ‘re-planning’ what’s already in train.
Indeed, uncertainty over the final outcome at Euston affects choices on HS2 routes to Leeds, just as much as anywhere else. As of now, with no Euston station design finalised, Network Rail planners will find there isn’t clarity on how many HS2 trains to London can be accommodated there from Leeds/Sheffield/Nottingham (and York/Newcastle).
And with no progress on the still forbidden part of HS2’s western arm – the Golborne Link (or its lengthier replacement) – doubt remains on whether the west coast route will be able to press ahead and double (in due course) the planned single train per hour high-speed service frequency between Glasgow/Edinburgh and London. Maybe HS2’s eastern arm will need to have an Anglo-Scottish function too.
Planning always has uncertainties such as these, but these current HS2 unknowns are a fundamental challenge that the Network Rail team will need to navigate.
The Adaptive Approach
The new Terms of Reference will only take them so far in figuring out how to address uncertainty, but Network Rail will no doubt want to examine carefully the proposed ‘adaptive’ approach. Indeed, it will note that apparently the HS2 to Leeds study is itself part of the adaptive approach:
“The adaptive approach includes a study to look at the most effective way to run HS2 trains to Leeds”.
According to the Terms of Reference for the HS2 to Leeds study:
“In the Integrated Rail Plan, the Government accepted the recommendation of an ‘adaptive approach’ by the National Infrastructure Commission, which means that further projects beyond the core pipeline may be considered in the future should they be delivered on budget.”
We assume ‘they’ means the core pipeline (rather than ‘further projects’) as being what needs to be delivered on budget.
As a reminder, the Integrated Rail Plan (IRP) was the November 2020 Government report that committed to the core pipeline £96bn spend out to 2050, in 2019 prices. (We briefly summarise some key parts of the IRP in Annex A.)
Greengauge 21 summary – the Core Pipeline in the Integrated Rail Plan of 2020
The core pipeline comprises the known parts of HS2 Phases 1 & 2a – both part suspended, it has to be noted – and the Crewe-Manchester part of Phase 2b (for which powers are being sought right now); plus selected parts of Northern Powerhouse Rail (none of which venture more than a few yards east of the Pennines) – and a set of upgrades and route electrification plans – Trans Pennine, East Coast Main Line and Midland Main Line and a few other elements such as the western part of the Midlands Rail Hub in Birmingham.
In the HS2 to Leeds Study terms of reference, it states that: ‘further projects beyond the core pipeline may be considered in the future, subject to how the wider national economy is progressing. And:
“this depends on demand and how economic growth recovers and on the complementary investments being made in areas such as skills.”
So, an adaptive approach is one in which projects beyond the core pipeline may be considered if:
- the core pipeline is delivered on budget, and
- beyond that budget, funding for HS2 to Leeds (which is not included in the the £96bn core pipeline) turns on how ‘economic growth recovers and the impact of complementary investments’.
At the current time, the focus on budgetary and inflationary indigestion in the immediate term will not be seen as a surprise. It leaves two possibilities:
- changes to the core IRP programme becoming more affordable within the £96bn set budget This would seem to be unlikely. Pressures appear likely to increase the planned capital spend – at Euston, for instance – or if any rail capital elements in the Union Connectivity Review conclusions are to be taken forward; or
- through additional funding becoming available as a result of stronger UK economic growth (more likely over the medium and long term).
But the need to look across the wider network suggests that the HS2 to Leeds Study would do well also to look for savings that can be made across the piece, for instance, in finding lower cost approaches to making changes to existing lines as part of a coherent rail strategy for Britain.
The capital budget looms large in the Terms of Reference, and recent experience of shifts in capital funding availability (between the November 2022 and April 2023 budget statements, for example) suggests this aspect of adaptation can be fast changing, especially at times of high inflation levels. As of July 2023, that is no doubt what HM Treasury intends.
Looking ahead, the Terms of Reference recognise that a budget limit and core pipeline set in 2020 cannot be expected to last for ever:
“options that are progressed, including those that would exceed the £96 billion envelope, will be subject to the established adaptive approach…” (emphasis added).
And as the Integrated Rail Plan put it just two years ago:
“The future may be more uncertain – which means we need a more adaptive approach that can respond to the trends we see.”
An adaptive approach makes a lot of sense in that the study explicitly needs to take account of interfaces and the realities they bring:
- with other transport systems (West Yorkshire Mass Transit, for example), but also of other incremental shifts – say in developing interim low-cost improvements to key corridors such as Sheffield-Leeds (Ref 2) and
- capital funding availability, which will shift (for better or worse) over time – on which the Terms of Reference focus extensively.
Even if the Leeds Study is published two years’ hence, as in the Study time-line, there will be the need to get Government reaction and sign off.
Recent experience is not promising. A Government response is yet to emerge for the Union Connectivity Review for which the final report was published in November 2021. At that pace, a decision on HS2 to Leeds could still be the best part of 4 years away, additional funding permitting. And as time passes, more ‘adaptations’ often become necessary.
So part of the task must be to get to a decision point and plan ahead to incorporate a planned Government response time, rather than leaving the study outcome as a published document without an attendant decision on implementation: the type of uncertainty that simply adds to project delivery costs.
The study will assess viable choices consistent with the decisions reached in the Integrated Rail Plan, taking as a given the creation of the southern part of the ‘Eastern Arm’ of HS2, the section linking the West and East Midlands.
These choices include but are not limited to:
- via Newark: the extension of HS2 Nottingham services via Newark and the East Coast Main Line route – to Leeds & Bradford and north east England
- via Sheffield: the extension of already planned HS2 services via Derby and the Midland Main line northwards from Sheffield
- via Manchester: the extension of HS2 services from Manchester assuming new Northern Powerhouse Rail (NPR) infrastructure is built along with the HS2 Phase 2b Western Leg as set out in the High-Speed Rail (Crewe-Manchester) Bill, with a new high-speed surface station at Manchester Piccadilly (where trains to/from Leeds would need to reverse) (Ref 3)
- via the Erewash valley: with upgrades and electrification to the Erewash Valley and Old Road lines, as well as sections of a new line to complete a route to Leeds
- via a full Eastern Arm: completing the HS2 Eastern Arm from the East Midlands, broadly as previously scoped.
We have set out the merits of the first of these options – the via Newark approach in earlier reports. (Ref 4) Given the Integrated Rail Plan commits to a significant upgrade of the East Coast Main Line (ECML) in any event, the via Newark option:
- offers the best opportunity to improve connectivity for the North East as well as Yorkshire/the Humber, and
- provides scope for investment programme synergies between the ECML upgrade and new sections of high-speed line and new high-speed services so bringing capital cost savings, and
- opens up the opportunity to use the HS2 Eastern Arm to bring HSR services to the key NE-SW cross country route, in turn creating a much wider opportunity to replace domestic air travel with zero carbon high-speed rail.
In welcoming the release of the HS2 to Leeds Study Terms of Reference, we need to flag a concern that they have taken so long to emerge and, looking ahead, the risk that the Government ‘sits on’ the Study conclusions when it is complete in 2 years’ time, wasting yet more time.
Delays may suit a mind-set dominated by (understandable) anxieties about capital investment at a time of inflation and growing Government debt levels. But as written, the Study Terms of Reference fail to acknowledge the counter-part to this position. Historically, HM Treasury recognised that its investment (if not operational spend) is critical to achieving the economic growth (and increased tax revenues) it is seeking. Efficient capital investment designed to improve the strength of the national economy is an outcome that Government should therefore actively seek (while making sure its investments are affordable), including through this important new study.
Finally, there is scant attention paid to decarbonisation, where we believe high-speed rail has such a substantial role to play by:
- reducing the need for travel on short-haul domestic flights
- releasing rail network capacity to accommodate a substantial switch of longer haul freight movements from HGVs (range-limited in a non-fossil fuel world) to electrically hauled railfreight
- reducing the need for longer distance travel by car.
This benefit-set is unique to high-speed rail, and it is inconceivable that the city regions in the eastern half of the country could be denied the opportunity to play their part in meeting Government’s national decarbonisation commitments by improving their interconnectivity by rail. The new Study should add these highly desirable environmental outcomes to its option appraisal framework. In a rapidly heating world, these factors are going to count.
Annex A: Integrated Rail Plan (IRP): (selected) key extracts
The publication of the IRP demonstrates that HS2 will not be a project in isolation, creating a separate network, but more clearly considered alongside, and as an integrated whole with, other major rail projects in the North and the Midlands. Through the Plan, the Government has been able to look at ways to harness the benefits of HS2, NPR, [Midland Rail Hub] MRH together, avoid duplicative investment, and identify interactions between projects. Integrating the network will allow better management of the portfolio and of costs.
The approach to investment will need to ensure schemes are properly developed and to provide a sustainable pipeline for the rail supply chain which can be delivered efficiently, avoiding previous ‘feast/famine’ cycles of investment while providing benefits to passengers and freight users as quickly as possible.
By further adopting an adaptive approach, as recommended by the National Infrastructure Commission (NIC), the Government has identified a core pipeline of schemes and any further schemes will be subject to affordability, delivering commitments on time and to budget, and complementary investments being made. Progress on these wider schemes will be subject to future affordability, demand, and progress with efficiency in the portfolio.
Many major infrastructure schemes have suffered from cost increases and delays in construction. The Government is committed to managing these risks within this programme, working with Network Rail and HS2 Ltd to ensure design work is driven by affordability and that trade-offs are considered where pressures arise.
The National Infrastructure Commission (NIC)’s Rail Needs Assessment and the Infrastructure and Projects Authority have both identified the need for the Government to take an adaptive approach as a way to mitigate [..] risks.
There are choices that must still be made, such as assessment of alternatives to Golborne as part of the upcoming Union Connectivity Review, which will be published shortly, and way to run HS2 services to Leeds. This will be considered as part of an adaptive approach, in line with the NIC’s recommendation.
Ref 1 – The Williams-Shapps Plan for Rail, sought urgent and radical change to ensure the railways become both more customer focused and more financially sustainable, working in the national interest as a public service. This included “developing a Whole Industry Strategic Plan (WISP) to underpin the delivery of this 30-year strategy, and support future planning and decision making beyond the programme set out in the Integrated Rail Plan (IRP).”
Ref 2 – Interim Rail Improvements for the Yorkshire Economy This work stresses the key economic opportunity better rail connectivity could stimulate, notes that capacity limitations in this corridor largely arise at the end-points in Sheffield and Leeds and suggest ways to include key locations such as Bradford, Barnsley, Rotherham in any rail improvement plan. High value/low cost interim measures such as these should figure in whatever the HS2 to Leeds study concludes is the best long term solution.
Ref 3 – The Terms of Reference note that: “the Integrated Rail Plan core pipeline already gives HS2 services from Birmingham to Leeds via Manchester”.
Ref 4 – East Coast High Speed
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