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Questions over high speed rail as HS2 chief quits £750k job to join Rolls-Royce

Questions over high speed rail as HS2 chief quits £750k job to join Rolls-Royce

🕔12.Sep 2016

Supporters of HS2 face a difficult few weeks after the high speed rail project’s chief executive quit in advance of a Government decision about approval for the second phase of the route from Birmingham to Leeds and Manchester.

Simon Kirby announced he was leaving HS2 Ltd to take up a senior position with Rolls-Royce.

Mr Kirby had been under increasing pressure from MPs and opponents of HS2 over his £750,000 salary and the escalating costs of the high speed project which is estimated to hit £55 billion for the entire route from London to the north of England.

It is likely that the Transport Secretary Chris Grayling will confirm whether or not the second phase of HS2 is to go ahead following the Chancellor’s Autumn Statement on November 23. There is speculation that construction of the eastern section of the line from Birmingham to Nottingham, Sheffield and Leeds may be delayed or even abandoned.

HS3, meanwhile, a £60 million line linking Manchester and Leeds promoted as part of the Government’s northern Powerhouse initiative, is set to proceed, as far as anyone knows.

Mr Hammond has said he recognises the economic benefits HS2 will bring and is reportedly keen on large-scale infrastructure projects as a means of delivering economic growth – something he will expand on in the Autumn Statement. Theresa May, the Prime Minister, has also indicated her support for HS2.

Mr Grayling may report on attempts by the Department for Transport to reduce the cost of the scheme.

MPs are yet to give final approval for HS2 Phase 1 from Euston to Birmingham Curzon Street and are expected to vote to do so before the end of the year.

The National Audit Office , the Commons Public Accounts Committee and several other bodies have warned that the Government is unlikely to be able to contain HS2 costs at £55 billion and may have to delay construction work on the first phase. There have been claims that the scheme could end up costing closer to £80 billion.

HS2 Chairman, David Higgins, said

I am delighted for both Simon and Rolls Royce that he has been appointed to this position. Whilst naturally we will miss his experience and leadership, I also recognise that he is joining a truly great, global company in an industry in which he has previously worked.

In his two and half years with the company, Simon has used his vast experience to recruit and shape a world class team which over the coming years and decades will turn HS2 into a reality that will be of lasting benefit to this country.

That team will continue that process as we start and complete the process of finding Simon’s successor.

I am also delighted to be able to announce today the appointment of Mel Ewel, formerly Chief Executive of Amey, as a Non Executive Director. His great experience in the construction industry speaks for itself, as does the huge respect in which he is held. As such he will be a great asset to the Board’s deliberations as we move to the point of construction.

Simon Kirby said:

HS2 is not just a highly ambitious project, but also one which will leave a lasting legacy for Britain. It has been, therefore, a huge honour to have been its Chief Executive and to have been involved in creating a leadership team made up of the best talents from this country and elsewhere. I have absolute confidence in their ability to deliver the project and, in doing so, to help transform the way we do things in this country.

The HS2 project has become the bedrock of strategic economic plans drawn up by local enterprise partnerships across the West Midlands with estimates that better connectivity between London, Birmingham, and the north of England will trigger massive regeneration and thousands of new jobs.

Birmingham is home to the HS2’s design ad engineering function, part of a dedicated college and high speed trains will be maintained at a depot in Washwood Heath. Land around the planned HS2 Curzon street station in Birmingham city centre and at a Birmingham Interchange station at the NEC/Airport have been earmarked for extensive regeneration and job creation.

Economic benefits from HS2 for the country as a whole are predicted to be £40 billion, according to the Department for Transport.

However, high speed rail has plenty of critics at Westminster.

Last week Lord Hollick, the chair of the Lords Economic Affairs Committee, reminded the chancellor that his committee found the case for HS2 has not been made, and that the Department for Transport are ‘marking their own homework’ in respect to the evaluation of the project.

This happened the same day that the Adam Smith Institute produced a report saying that HS2 was an “economically irresponsible” project.

The report can be accessed here.

Lord Hollick asked the Chancellor to put the brakes on HS2, saying:

When we conducted our investigation into HS2 where we concluded the case was not made.  Perhaps you’ll consider hitting reset, the pause button on that as you’ve done on Hinckley. One of our concerns was that the process within Government to evaluate these sorts of projects left much to be desired.

Lord Hollick wanted the Infrastructure Commission, announced by previous Chancellor George Osborne, to have a statutory requirement to look at projects like HS2, but Mr Hammond dismissed this, saying that the Department for Transport has a good project evaluation team, to which Lord Hollick replied:

I always got rather higher marks when I marked my own homework as well.

Earlier in the session, former Chancellor Lord Darling asked if small infrastructure projects that can be delivered quickly would be better than HS2 at producing an economic stimulus.

Stop HS2 Campaign Manager Joe Rukin said:

The Lords Economic Affairs Committee and the Adam Smith Institute are just two in a long list of independent bodies which have found there is no case for HS2, and with the Chancellor himself admitting that it is unlikely to provide a quick fiscal stimulus, there is even less justification for going ahead with this white elephant.

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