HS2: What now for freight and logistics?

CILT is deeply disappointed at the cancellation of HS2 north of Birmingham. The dramatic improvements in connectivity the North and Scotland would have seen cannot be delivered by alternative schemes and their economies will be significantly disadvantaged as a result.

The rest of the world is forging ahead with construction of high-speed rail lines as the preferred way of improving infrastructure and decarbonising long-distance transport. It does not seem plausible that the current UK government is right to abandon high speed rail and that everyone else has it wrong.

The problem with HS2 is not that it is the wrong project, but that its costs have been allowed to escalate out of control. Some cost inflation was inevitable as a result of Putin's invasion of Ukraine, but not to the extent which has occurred on HS2. Other densely populated countries are able to control the cost of major infrastructure projects and, within the UK, HS1 was delivered on time and under budget.

A level of cost inflation has come about by changes to specification – particularly compared to the original proposals for a TGV-style line. Subsequent cost inflation suggests that something has gone badly wrong with the management of HS2 and we consider that a key factor was the failure to appoint and retain seasoned professionals, with knowledge of how to specify, tender and control major rail schemes, to senior roles in the project. CILT believes the correct course of action would have been to undertake a comprehensive review of HS2 costs by such seasoned professionals, using best practice from around the world, and considers the opportunity to do so should now be taken. Rather than a "bespoke UK" solution, consideration should be given to using specifications from existing schemes in Europe and beyond.

The climate crisis is worsening by the year and the need to decarbonise is becoming greater and more urgent. Net Zero 2050 remains an imperative and Government must not weaken long term commitments for short term expediency. Funding should not be diverted to high carbon road projects simply to satisfy the demands of a vocal minority.

This is particularly true with freight and logistics. Almost all large companies now have clear carbon reduction strategies, but decarbonising long distance road freight movements is extremely challenging. Battery HGVs will carry out local and regional distribution, but decarbonising trunk haulage by road is much more difficult and, for this reason, modal shift to rail trunking is an attractive option for many companies. Rather than a significant allocation to road projects, a proportion of any money released from HS2 should be invested in modal shift by increasing capacity at key locations and electrifying missing links in the core rail freight network, 60% of which is already electrified. Wiring 800 miles over the next 20 years at a cost of less than £2bn would allow c.95% of rail freight to be electrically hauled with zero carbon emissions.

We welcome the announcement that capacity is to be increased on the vital freight route from Felixstowe to the Midlands and North, with investments at Ely and Haughley Junctions. This route should also be electrified as key strategic investment for freight and logistics, supporting supply chains for businesses in the Midlands and the North.

A series of investments in capacity on the West Coast Main Line are also required in lieu of the capacity that would have been released by HS2. These include 4-tracking between Colwich and Stafford plus between Winsford and Warrington. It is essential that a significant proportion of the capacity released by HS2 Phase 1 continues to be earmarked for freight.

Providing certainty on such projects would help to encourage private investment in rail-connected logistics centres, which in turn supports the UK's move to decarbonise transport. This is private investment which may look outside of the UK if there remains uncertainty over when the projects replacing HS2 are due to be delivered.