HS2 costs increasing due to skills shortage

Sir David Higgins, the chairman of HS2, has provided evidence to the Lords claim suggesting that the UK’s lack of experience in building new railway lines was contributing towards the high construction costs of HS2.

The project is set to cost £90 million per kilometre, compared to the £23.3 million per kilometre cost of the HS1 link from the Channel Tunnel to London.

Higgins explained that the construction industry in the UK is fragmented – suggesting that public and private sector firms base decisions on the lowest cost, as opposed the quality.

As a result, firms throughout the supply chain see the margins under continual pressure, leaving little room for the long-term development and investment in skills.

Higgins criticised the public sector, suggesting that greater investment in future skills is needed, commenting: “The biggest buyer of construction in this country is the Government, and the Government needs to buy on terms other than, ‘I am just going to screw you to the lowest possible cost. I am not going to worry about your commitment to R&D or investment in skill.”

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