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UK Politics

End of the line? HS2 rail link project in doubt as Labour prepares to drop backing for £50bn scheme

Lord Mandelson condemned the scheme, saying it would 'suck the very life blood' out of the rest of the rail network

The future of the High Speed 2 rail project is in growing doubt as Labour prepared to drop its backing for the £50bn scheme and the Tory rebellion against the proposed line gathered pace.

Despite David Cameron’s outspoken support for HS2, fears are intensifying within Downing Street that the Government will be forced to abandon the largest rail building project for a generation, The Independent understands.

There are also concerns in Whitehall that ministers could struggle to obtain the private finance essential for the scheme to go ahead. In another sign that the project is in trouble, Mr Cameron changed his language and prepared the ground for blaming Labour if it collapses.

In a Commons debate next week, ministers will make a fresh attempt to set out the case for HS2, which would connect London and Birmingham by the year 2026 and the North of England by 2033. At least 30 Conservative MPs are ready to defy their party whip and vote against preparatory work on the project.

The Labour leadership will vote with the Government next week and Ed Miliband supports the scheme. But there are signs the party is rapidly becoming sceptical about the merits of HS2 and could drop its support next year when crucial legislation is due before Parliament.

Ed Balls, the shadow Chancellor, told the Labour conference last month there could be “no blank cheque” for the project. Party sources indicated that Mr Balls was increasingly hostile to HS2 and that support for the scheme was “cooling” within the shadow Cabinet.

Mr Balls said he backed it in principle but stressed: “What I am not going to do is say we support it when the costs are rising, the benefits are unclear and the Government are acting like cheerleaders rather than proper stewards of public money.”

The HS2 scheme was devised by Gordon Brown’s government and adopted by the Coalition. But Mr Cameron has been besieged with protests from Conservatives in the shire counties through which the high-speed line would be built.

Anger over the project spilled over in a recent private meeting between the Prime Minister and chairmen of local constituency parties, who queued up to warn him it was a waste of money and would hit the party at the ballot box. A Tory source said: “He was told pretty bluntly there would be a lot of political pain without much political gain.”

Asked about wavering Labour backing for HS2, Mr Cameron said: “This is an important project, it does have all-party support. We supported it in opposition when Labour were in government. Labour support it today, as I understand it, now we are in government.

“The Liberal Democrat party support it as well, and that is all to the good because these multi-year multi-Parliament infrastructure projects can’t go ahead without all-party support. You won’t get the investment, you can’t have the consistency.” He added: “If Labour are to run away from this, they will be letting down the Midlands, they will be letting down the North.”

Nick Clegg, the Deputy Prime Minister, told BBC Radio 2: “I cannot understand why Labour is turning its back on HS2. That is a monumental betrayal of the North by Labour.”

Tory critics have been heartened by the apparent change of heart by Labour. The former Cabinet minister Cheryl Gillan said: “This isn’t really the project that the Prime Minister, the Chancellor and the Secretary of State for Transport should be hanging their hats on. The problem is that this project dwarfs anything else… so you have to have substantial cross-party support.”

Andrew Bridgen, the MP for North West Leicestershire, who is coordinating a backbench opposition campaign to HS2, said: “The more people find out about HS2, the less they like it.” He predicted: “One way or another, there won’t be one yard of track laid.”

Bob Woollard, the chairman of Conservative Grassroots organisation, said: “Opposition to this is growing and will continue to grow. The Prime Minister has got to start listening to his own grassroots supporters.”

The Government’s estimated price tag for HS2, including rolling stock, has risen to £50.1bn. One independent study estimated the eventual cost at £80bn, while there have been reports the Treasury is working on a figure of more than £70bn.

Critics of the scheme include the Commons Public Accounts Select Committee, the Institute of Directors, the Institute of Economic Affairs think-tank and two senior Labour figures – Alistair Darling, the former Chancellor, and Lord Mandelson, the former Business Secretary.

In a withering attack on the scheme in the Lords on Thursday, Lord Mandelson condemned it as a “political trophy project” which would “suck the very life blood” out of the rest of the rail network.