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Rishi Sunak faced a storm of protest on Monday as the UK prime minister prepared to use his Conservative party conference in Manchester to announce the axing of the northern leg of the HS2 high speed rail line.
Andy Street, the Tory mayor of the West Midlands, accused Sunak of “cancelling the future” and undermining investor confidence in Britain by aborting the country’s most high-profile infrastructure project.
“If you tell the international investment community you are going to do something you bloody well have to stick to your word,” he said at a meeting on the fringe of the Conservative conference.
Downing Street insisted “no decision has been taken” on HS2 but senior Conservatives said Sunak had decided to save billions of pounds by building only the southern leg between London and Birmingham.
Aides to Jeremy Hunt, the chancellor, did not deny that he had already approved the radical scaling back of the HS2 project. “A decision will be announced in due course,” said one.
One cabinet minister said Sunak was planning to use his conference speech on Wednesday to announce that money saved from the HS2 project would be diverted to “other rail and bus projects”.
One senior rail industry official said: “My sources tell me the PM has made his decision and is unlikely to change his mind.”
Sunak is expected by government officials to commit to a substantial upgrade of the Transpennine route between Leeds and Manchester, along with other local transport schemes that he claims will offer better value for money.
But Sunak’s decision would turn HS2 — once the government’s flagship “levelling up” project — into a shuttle service between Birmingham and London. The line could terminate at Old Oak Common, six miles from central London, rather than Euston, to save more money.
Andrew Gilligan, a Number 10 adviser and HS2 critic, wrote a pamphlet for the Policy Exchange think-tank last November saying that scaling back the project could save £3bn a year by 2027-28 and “perhaps £44bn or more in total”.
One cabinet minister said of HS2: “It’s a monstrosity. We have to cut our losses.” But Tory officials lamented the way in which Sunak had allowed the row over the future of the rail line to dominate the conference.
In a direct message to Sunak, Street acknowledged costs on the project had risen, but warned “gripping this situation” did not mean “giving up, admitting defeat, or even . . . cancelling the future”. In a series of interviews, Street declined to say whether he might resign over HS2.
The debate over HS2’s northern leg had become about “Britain’s ability to do the tough stuff successfully”, he said, and its “credibility as a place to invest”. “That’s what’s now at stake,” he added.
Four former prime ministers have already warned Sunak against scrapping the northern leg of HS2.
Henri Murison, chief executive of the Northern Powerhouse Partnership, a business lobby group, said: “We urge the prime minister to listen to the business community about what this would mean for inward investment, for jobs and the UK’s international reputation.”
Earlier, Hunt warned Conservatives activists in a speech that tax cuts must be funded by a squeeze on public spending, as he prepares to swing the axe on HS2 and the civil service.
Hunt told the conference he would save £1bn by freezing civil service numbers, with an eventual plan to cut 66,000 posts, reducing the public sector workforce to pre-pandemic levels.
The chancellor also wants to reduce the estimated 10,000 people working full time on equality and diversity initiatives in the civil service.
But Mark Serwotka, general secretary of the Public and Commercial Services union, said shrinking “an already overstretched and under-resourced” civil service would inevitably result in cuts to vital services.
The Tory conference has been dominated by a clamour from senior Conservatives, including some ministers, for Sunak and Hunt to cut taxes before the next general election, expected in 2024.
Hunt said that fighting inflation — rather than tax cuts — was his top priority, telling party activists: “Nothing hurts families more.”
Additional reporting by Delphine Strauss in London
