• HS2 Ltd and DfT are resetting the HS2 programme, which is now estimated to cost double what was expected in 2020 – up to £102.7bn – and be fully open up to 13 years late.
  • HS2 Ltd and DfT are taking a considered approach, but significant work remains before they can complete the reset in 2027. This includes finalising the cost and schedule, completing commercial renegotiations, developing plans at Euston and ensuring that the right skills are in place to deliver the programme.
  • In completing their reset of the programme, the NAO recommends that DfT and HS2 Ltd ensure that they do not proceed with putting their revised plans into action until they are confident everything is in place to deliver against them.

The Department for Transport (DfT) and HS2 Ltd are making progress in their reset of the High Speed Two (HS2) railway line, but must ensure they fully put the programme on a stable footing to avoid previous failures, a new report from the National Audit Office (NAO) has found.1

The High Speed Two programme aims to bring high-speed rail travel between London and Birmingham. The programme was initially intended to have a route going further north than Birmingham (known as Phase 2), but this was cancelled in 2023. DfT reset the programme to deliver HS2 in 2020, and then again in 2025. To March 2026, DfT and HS2 Ltd have spent £46.8 billion on HS2, including on Phase 2, and HS2 Ltd expects to spend a total of £153m on its 2025 reset, and to have completed this by spring 2027

The cost of HS2 has increased significantly since 2020. In May 2026, DfT updated the estimated cost of completing the HS2 programme to be between £87.7 billion and £102.7 billion. This is around double the 2020 cost estimate for Phase One (the Euston-Birmingham route).

The driving causes behind the majority of these cost increases are scope change, inefficient delivery and an underestimation of the time needed to complete delivery. Further work is needed to refine the May estimate, and HS2 is working towards a more certain and fully assured baseline estimate by spring 2027. Despite the cost increases, DfT assessed that completing the programme would represent value for money compared with cancelling the programme.

The programme is also heavily delayed. The full completion of the line between Euston and north of Birmingham is not expected until 2040-43, although services between Old Oak Common in West London and Birmingham are expected to commence earlier, in 2036-39. This represents a delay to the full railway opening of between around three to 13 years.2

DfT has attempted to reduce risks and cut costs by reducing the speeds of the trains. By reducing the speed from 360 km/hr to 320 km/hr (similar to high-speed European trains), DfT estimates this will reduce the delay in delivery times due to not having to test the railway to this higher speed, and will save between £1 billion and £2.5 billion. However, longer train journeys will cause a longer-term loss in benefits of £1.3 billion, which could negate the savings in reducing the speeds.3

Another key component of the success of HS2 is the delivery of the new station at Euston. £3.8 billion has been spent on works at Euston so far, with another £4.1 billion of public funding anticipated, based on early designs, to create the HS2 station and complete the tunnelling into Euston from Old Oak Common. Total costs will be higher, once the private finance the government intends to use to deliver the station is confirmed and included.4

HS2 Ltd is also making efforts to improve delivery as part of the reset, such as seeking to make savings by renegotiating supply chain contracts to better incentivise cost-effectiveness. HS2 Ltd hopes to save around £2 billion through its approach to the commercial reset, by avoiding costs it would incur if work took longer.

HS2 Ltd is also overhauling its organisation after internal reviews found it was poorly structured to deliver the revised programme scope and lacked key delivery and contract management skills.

Although it is clear that DfT and HS2 Ltd are taking a considered approach to resetting the programme, there is still a significant amount of work to do before completion. To aid in the programme’s delivery moving forwards, the NAO recommends that DfT and HS2 Ltd must:

  • Review the reset timetable in the autumn to assess whether it remains achievable;
  • Maintain a focus on cost, schedule and commercial management as they move into the next stage of the programme.
  • Revisit the governance as the programme moves into the next stages of work to check it remains fit for purpose.

“After facing historic difficulties, including significant cost increases and delays to delivery, HS2 Ltd and DfT are taking a considered approach so far in their latest reset to the HS2 programme.

“However, these previous issues highlight the importance of DfT and HS2 Ltd getting it right this time to ensure the future success of the programme. Establishing a fully robust estimate of cost and schedule, completing commercial negotiations and getting the right capabilities in place is necessary before they can complete the reset.”

Gareth Davies, head of the NAO

Read the full report

High Speed Two reset

Notes for editors

  1. The full report will be available on the following link from 00:01 on Monday 29th June: https://www.nao.org.uk/reports/high-speed-two-reset/  
  2. See Figure 5 in the report for a more detailed break down of Changes in the planned (HS2) opening schedule between DfT’s 2020 and 2026 estimates. 
  3. DfT and HS2 Ltd are also looking at the seat capacity needed on the trains. They are exploring the potential for longer trains and expect to decide what is needed for the wider network over the next 18 months. 
  4. DfT intends to bring in a private finance partner in the early 2030s, towards the end of design work. It began early market engagement on this approach in February 2026 to help inform its development. The total costs of works at Euston will be higher once the expected private financing is included.