'Choices will be necessary' for North's railway future amid warning to avoid 'spreading investment thinly between as many places as possible'

The National Infrastructure Commission (NIC) has been tasked by the Government with presenting the options available for improving rail connections in the North and the Midlands.

And in an interim report released today, the organisation warned ministers could not look to put all schemes into place without spending sufficient money.

The report said: “The scale of these proposals, both in terms of what needs to be built, and the affordability of building it, means that choices are likely to be necessary.

“Spreading investment thinly between as many places as possible will not address geographical variation in economic outcomes – investment needs to be concentrated to make a difference.”

When approving HS2 in February, Boris Johnson announced an Integrated Rail Plan to examine the best way to bring together various railway plans in the North and the Midlands, and how to do so quicker.

But the NIC report said: “However, on current timelines, major rail proposals, including HS2 Phase 2b [the route connecting Crewe to Manchester and the West Midlands to Leeds], may not be completed before 2040.”

The NIC said: “It should not take 20 years to address problems that are already acute.”

The commission will also look at the costs of proposed schemes, and said “optimism” meant cost estimates were consistently under what the final bill turned out to be.

The interim report said: “There is a long history of overspends on major rail projects.

“The cost of electrification of the Great Western railway grew by £2.4bn between 2013 and 2016. Costs for the West Coast Main Line upgrade rose by £7.8bn. The central section of the Elizabeth line was initially planned to open in December 2018, but this has since been delayed to 2021, and the costs of the project have increased by £2.8bn since 2011. And the Oakervee Review found that the HS2 project, as currently scoped, no longer falls within the existing funding envelope.”

The total estimated cost of HS2, Northern Powerhouse Rail and Midlands Engine Rail is in the region of £101 – 139bn in 2019/20 prices between 2020 and 2045, significantly above the £86.2bn initially proposed.

The report said: “Cost overruns are driven by several factors, from underestimation of the cost and quantity of materials required, to external factors such as changes in standards during construction. However, cost estimates for projects continue to not sufficiently consider these possibilities, in part down to optimism, and current allowances for optimism do not seem to be enough to offset this.”

The commission added that decisions should be taken on a wide view of the benefits that rail transport into the county’s largest cities and towns can bring.

Sir John Armitt, Chair of the National Infrastructure Commission, said: “Our discussions with leaders across the North and Midlands in recent weeks has made clear the desire for improved rail services to support economic growth across communities.

“We will assess how best to sequence and integrate the various schemes so communities can benefit as soon as possible. Our analysis will seek to reflect the complexities involved, and present Government with a menu of options from which they can take informed decisions.”

The final report will be passed to Government in November.