PM redirects HS2 funding to revolutionise transport across the North and Midlands

A revolution in the country’s transport infrastructure will see billions of pounds redirected from spiralling HS2 costs to build the daily connections that people depend on – unlocking potential, driving growth and transforming communities

  • Spiralling HS2 costs redirected to build Network North and fund raft of transport projects across the country, delivering the strong, reliable connections people depend on every day    
  • Rail, roads and buses to benefit from £36 billion in transport improvements in fundamental shift to how Government invests in transport infrastructure – unlocking potential faster in our towns, cities and rural areas  
  • A further £12bn is set aside to deliver fast links between Liverpool and Manchester 
  • Prime Minister prioritises the forms of transport that matter most to people and will deliver for future generations – driving jobs, growing the economy and levelling up the country

A revolution in the country’s transport infrastructure will see billions of pounds redirected from spiralling HS2 costs to build the daily connections that people depend on – unlocking potential, driving growth and transforming communities. 

The Prime Minister has today [Wednesday 4 October] unveiled his vision to deliver the forms of transport that people use the most. The new plans will radically improve travel between and within our cities and towns, and around our local areas – benefitting more people in more places, more quickly.  

The cornerstone of this plan will be Network North which will drive better connectivity across the North and Midlands with faster journey times, increased capacity and more frequent, reliable services across rail, buses and roads. £36 billion will be invested in hundreds of transport projects across the country – with every region set to receive the same or more transport investment on an unprecedented scale as a result of the change.   A further £12 billion on top of this figure will be set aside for faster connectivity between Liverpool and Manchester.  

This represents a fundamental shift in investment towards the people’s transport priorities, consistent with the Prime Minister’s pledge to grow the economy while ensuring value for money and demonstrating responsibility with taxpayers’ money.   

More than four million people in cities in the North cannot currently reach their city centre by public transport within half an hour, which is detrimental to productivity and economic growth. And rail accounts for just 8 per cent of distances travelled and 2 per cent of all journeys.  

Yet the HS2 project currently accounts for over one-third of all Government’s transport investments, preventing the Government from spending on people’s genuine priorities and doing little to improve the journeys that people make the most.   

Therefore, the Government will deliver HS2 between Euston in central London and the West Midlands as planned, with a station at Old Oak Common and Birmingham Interchange and branches to central Birmingham and Handsacre, near Lichfield – where HS2 trains for Manchester, Liverpool and Scotland will join the West Coast Main Line. 

HS2 trains will run from Euston to central Birmingham in 49 minutes, 30 minutes faster than now; from Euston to Manchester in 1 hr 40 minutes, 27 minutes faster than now; from Euston to Liverpool in 1 hr 45 minutes, 26 minutes faster than now; and also to Lancashire, Cumbria and Scotland, saving significantly on current journey times.  

Rather than delivering HS2 Phase 2 new line between Birmingham and Manchester, the Prime Minister is taking action to deliver greater frequency and quality of transport infrastructure across the whole country.   

Communities in towns, cities and rural areas will see improved transport infrastructure far sooner through £19.8 billion reinvested in the North, including:  

  • £2 billion for a new station at Bradford and a new connection to Manchester;  
  • £2.5 billion to deliver a new mass transit system in West Yorkshire;  
  • £3 billion for upgraded and electrified lines between Manchester and Sheffield, Sheffield and Leeds, Sheffield and Hull, and Hull-Leeds.  
  • Nearly £4 billion more funding for local transport in the North’s six city regions. 
  • A new £2.5 billion fund for local transport across all areas in the North outside the six city regions – smaller cities, counties, towns and countryside.  
  • A new £3.3 billion fund for road resurfacing.  
  • Landmark investments in roads, reopened train lines and new stations;  

We will also invest a further £12 billion to better connect Manchester to Liverpool. This would allow the delivery of Northern Powerhouse Rail as previously planned, including high-speed lines. But we will work with local leaders to agree whether they wish to suggest other ways to achieve the objectives within that cost envelope. 

£9.6 billion reinvested in the Midlands: 

  • Funding the Midlands Rail Hub in full with £1.75 billion, connecting 50 stations and over 7 million people – doubling capacity and frequency;  
  • Over £1.5 billion guaranteed local transport funding for the new East Midlands Mayor;  
  • Over £1 billion extra local transport funding for West Midlands City Region; 
  • A new £2.2 billion fund for local transport across all areas in the West and East Midlands outside the city regions – smaller cities, counties, towns and countryside. 
  • Reopened train lines and new stations such as the Ivanhoe Line;  
  • The development of Midlands road schemes to benefit businesses and their employees at Rolls Royce, Toyota, and Magna Park, generating over £12 billion for the local economy.  

£6.5 billion for the rest of the country: 

  • Rail improvements in the Southwest;  
  • Keeping the £2 bus fare until the end of December 2024;  
  • Ensuring the delivery of road schemes;  
  • Transforming Ely Junction; and billions to fix potholes on the country’s roads;  
  • Greater connectivity for both Scotland and Wales with improvements to the A75 between Gretna and Stranraer, and £1 billion to fund the electrification of the North Wales Main Line.   

To ensure regions are best equipped to reach their productivity potential, local authorities and Metro Mayors will be empowered to create the public transport networks that their communities want to see. We will also set out a broader package of infrastructure planning reforms in the coming months to remove burdens to building to ensure these projects are delivered and benefits felt in communities more quickly.  

Originally, every pound spent on HS2 was set to deliver £2.30 worth of benefits back to the taxpayer. Despite revising the scope, benefits could fall as low as 80 pence  for every £1 spent.    

Meanwhile, the original benefits-cost ratio for HS2 was underpinned by assumptions which are no longer valid. Covid-19 has completely changed travel patterns and business rail travel is currently around half of 2019 levels while the majority of public transport journeys continue to be taken by bus – at three billion a year.   

However, we will complete Phase 1 of HS2 where significant construction is already underway, cutting journey times from Birmingham to central London from around 80 minutes to 49 minutes. This will have a transformative effect on rail capacity, nearly allowing up to 250,000 passengers to travel every day – supporting growth for decades to come. 

To unlock growth potential for London and deliver thousands of additional homes at Euston, the Government will oversee a change in leadership of the project to ensure maximum value for the taxpayer, while attracting private investment to build a world-class station. This will release more than £6 billion to invest in transport projects right across the country, delivering road, rail and bus upgrades in communities that were never set to benefit from HS2.  

So, the Prime Minister has today drawn a line under the spiralling costs of delivering HS2 in full, in recognition of the changed economic context and modern transport demands. Instead, the redirected funding will deliver the vital transport links that people want and need to get to work, take their children to school, access doctors’ appointments and visit friends and family – connecting our great towns and cities while delivering real change to benefit the country and future generations.

Prime Minister's Office, 10 Downing Street
The Rt Hon Rishi Sunak MP