HS2 accused of hiding £2bn property purchase overspend

 

The HS2 project has been hit with further allegations of cost overruns, this time to the tune of £2bn on property acquisition costs.

The Sunday Times reported allegations from ‘a senior manager turned whistleblower’ that HS2 Ltd had pressed staff to falsify figures, and cover up ‘petrifying’ overspends, including misleading Parliament

”Local

In documents seen by the newspaper, Doug Thornton, the firm’s former head of property, said the organisation put him under ‘tremendous pressure to accede to an enormous deceit’ – that the official budget for buying land and buildings was accurate.

He claimed that the costings were in fact wrong by billions of pounds, having been based on ‘rudimentary map-based analysis by interns’, and contain errors running into tens of millions of pounds on single properties.

The Sunday Times said the claims are contained in letters and reports sent to cabinet secretary Sir Jeremy Heywood, the National Audit Office and the Royal Institution of Chartered Surveyors between 2016 and March of this year.

It said that although HS2 Ltd told MPs and peers that buying the 11,000 properties and plots of land needed to build Phase One of the route would cost £2.8bn, Andrew Bruce, its former head of planning and performance, had produced detailed calculations showing that the true cost of property in this phase alone would be £4.7bn.

Mr Thornton said HS2 may have ‘knowingly misled parliament’.

A spokesperson for HS2 Ltd disputed Mr Thornton’s allegation that he and Mr Bruce were dismissed because of whistleblowing.

He said: ‘We regularly update the Board on the costs of land and property, and use industry best practice methods to identify these costs. The programme remains on track, and costs are within budget.

‘We conduct regular capability reviews to ensure that we have the right structures and skill sets at different stages of the programme. These are an essential part of how any programme develops and we regularly review and audit that we are continuing to put in place the right capabilities.’

Separately, New Civil Engineer reported that contractors carrying out civil engineering works for Phase One have been given an extra eight months to adapt their designs to meet target costs.

It said HS2 Ltd has pushed back the notice to proceed deadline from November until June 2019, to allow the contractors to cut costs on the project, which were reported last week to be coming in at around £1bn above the target cost.

HS2 Ltd repeated its assertion that it remains ‘on track, and within our original cost package’.

 

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