HS2 delay will lift costs and cut jobs, says Labour

Labour claims it has seen a leaked document which admits that delays to the HS2 rail project announced last week "will increase costs" and firms could go bust.

Shadow Transport Secretary Louise Haigh told MPs a paper by "senior officials" showed some areas promised high-speed services could be axed altogether.

Ms Haigh also said the route could terminate outside of London until 2041.

The government said it did not comment on leaks.

Last week Transport Secretary Mark Harper announced that the Birmingham to Crewe stretch of HS2 would be delayed by two years to spread out spending due to costs soaring because of higher inflation.

Ms Haigh told the House of Commons that in the documents "they admit it will cost jobs… construction firms could go bust".

She added: "They cannot rule out slashing high speed trains serving Stoke, Macclesfield and Stafford altogether."

Ms Haigh was speaking in the House of Commons after Conservative MP Iain Stewart, chair of the Transport Select Committee, tabled an urgent question on the revised timetable and budget for completion of HS2.

Huw Merriman, rail and HS2 minister, said the government was within its remit to look at all of its portfolio when "public spending pressures" were having an impact on borrowing.

Figures from the rail and industry sectors both told the BBC last week that delaying construction of the network would still increase costs and jeopardise future investment in the country.

GB Railfreight chief executive John Smith warned against the move calling it "half-baked" and voiced concerns the Crewe leg would be cancelled altogether.

Sir John Armitt, chair of the National Infrastructure Commission, said the delay would just push up costs in the long run.

"Every time you delay a construction project you inevitably increase its costs because they don't get stopped, you just run them out over a longer period of time," he said.