HS2: Update following the Northern leg cancellation

Public Accounts Committee Closed Inquiry
Opened: 31 Oct 2024 Closed: 16 May 2025 Parliament page
In October 2023, the Government announced the cancellation of Phase 2 of the High Speed 2 (HS2) railway from the West Midlands to Manchester, as well as a smaller HS2 station in London Euston. Following this announcement, the Department for Transport (DfT) and DfT’s arm’s-length body HS2 Ltd began work … Read more
8 Recommendations
43 Conclusions
1 Report
1 Oral session
15 Letters
1 Event
Activity timeline 18 events
4 Sep
2025
Correspondence
9 Jul
2025
Correspondence
8 Jul
2025
Correspondence
3 Jul
2025
Correspondence
30 Jun
2025
Correspondence
26 Jun
2025
Correspondence
9 Jun
2025
Correspondence
19 May
2025
Correspondence
16 May
2025
Report published
17 Mar
2025
Correspondence
28 Feb
2025
Report published
4 Feb
2025
Correspondence
Oral evidence sessions 1 session
19 Dec 2024
View on parliament.uk
Alan Foster · HS2 Ltd Alan Over · Department for Transport Dame Bernadette Kelly DCB · Department for Transport Mark Wild · HS2 Ltd
Recommendations & Conclusions
51 results
2 Conclusion
10th Report - HS2: Update followin…
Publish agreed HS2 cost estimate methodology and update programme costs regularly
The Department and HS2 Ltd’s failure to work together effectively is starkly illustrated by them not being able to agree how much HS2 will cost. The Department and HS2 Ltd have still not agreed on how much it will cost … Read more
HM Treasury
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3 Conclusion
10th Report - HS2: Update followin…
Report progress on HS2 contract renegotiations and plans for achieving cost savings
HS2 Ltd’s construction contracts are unacceptable to the public purse and it is imperative that HS2 Ltd deliver on its assurances to us that it can renegotiate these and deliver significant cost savings. The terms and operation of these contracts … Read more
HM Treasury
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4 Recommendation
10th Report - HS2: Update followin…
Assess new nature restoration fund's impact using HS2 bat tunnel case study
HS2 Ltd’s efforts to reduce the environmental impact of HS2 are not delivering value for money, with the c.£100 million cost of a protective ‘bat tunnel’ more than doubling the cost of that section of railway alone. The Committee does … Read more
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5 Conclusion
10th Report - HS2: Update followin…
Address HS2 leadership and capability gaps to ensure successful programme delivery
The Department and HS2 Ltd do not have the skills and capabilities needed to successfully deliver the programme. The Public Accounts Committee has repeatedly raised concerns over the Department and HS2 Ltd having the skills and capability they need. Following … Read more
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6 Conclusion
10th Report - HS2: Update followin…
Update Parliament on HS2 Euston progress, funding, risk management, and costs
The Department’s plans for Euston carry huge risks given the uncertainties about its scope, cost, funding, schedule and delivery model. In the 2024 Autumn budget, the government confirmed that HS2 would terminate at London Euston rather than Old Oak Common … Read more
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7 Conclusion
10th Report - HS2: Update followin…
Slow progress on HS2 land and property disposal decisions post-Phase 2 cancellation
Things are moving too slowly on making decisions on the disposal of land and property purchased as part of the programme. The Department has yet to determine what land and property can be disposed of following the cancellation of Phase … Read more
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8 Conclusion
10th Report - HS2: Update followin…
Require the Department to report on lessons learned and their practical implementation to the Committee.
Over the last decade the Department and HS2 Ltd have repeatedly said they are learning lessons but there is little evidence that lessons have been applied effectively and mistakes avoided. Since 2013, the Department and HS2 Ltd have told the … Read more
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1 Conclusion
10th Report - HS2: Update followin…
Committee examines current state of HS2 programme with Department and HS2 Ltd.
On the basis of a report by the Comptroller and Auditor General, we took evidence from the Department for Transport (the Department) and High Speed Two Limited (HS2 Ltd) on the current state of the High Speed Two (HS2) programme.1 … Read more
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9 Conclusion
10th Report - HS2: Update followin…
HS2 programme reset to take until mid-2026 for assured contractual baseline.
We were told by HS2 Ltd that it would take time to implement the changes needed as part of the programme’s fundamental reset, with all of 2025 needed to ensure the organisation’s activities are all orientated towards delivering Phase 1. … Read more
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10 Conclusion
10th Report - HS2: Update followin…
Department and HS2 Ltd disagree on total programme cost estimates and methodology.
The Department and HS2 Ltd still disagree on the estimated total costs for completing the programme. Despite using the same data, the Department and HS2 Ltd told us that estimates differ because they disagree over a range of technical factors … Read more
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11 Conclusion
10th Report - HS2: Update followin…
Department and HS2 Ltd are working to agree cost estimation methodology with Treasury.
Both the Department and HS2 Ltd told us that they were working together to reach an agreed methodology including drawing on third–party technical advice on cost estimation and, to ensure that the underpinning assumptions of future estimates are agreed, establishing … Read more
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12 Conclusion
10th Report - HS2: Update followin…
HS2 Ltd's latest Phase 1 cost estimate significantly exceeds prior figures and funding envelope.
Prior to the October 2023 announcement, HS2 Ltd estimated that the total costs of Phase 1 would be £49 billion to £57 billion. The Department’s estimate was lower, at £45 billion to £54 billion but still above the funding envelope … Read more
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13 Conclusion
10th Report - HS2: Update followin…
HS2 cost estimates in 2019 prices are unsatisfactory, projected to reach £80 billion.
We expressed to the Department how unsatisfactory we found it that the cost estimates for completing the programme are still in 2019 prices. The Department agreed, telling us that it expects that any funding agreed at the spending review will … Read more
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14 Conclusion
10th Report - HS2: Update followin…
HM Treasury to challenge HS2 revised costs before final programme budget agreement.
The Department confirmed that as well as agreeing a revised cost for the programme with HS2 Ltd, there will also be challenge from HM Treasury before a revised budget for the programme can be set. It told us that HM … Read more
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15 Conclusion
10th Report - HS2: Update followin…
Department manages HS2 via annual funding despite need for long-term profile.
The Department emphasised the need for a long–term spending profile for the completion of HS2, acknowledging to us that agreeing annual budget settlements was really poor for long–term infrastructure delivery.26 20 C&AG’s Report, para 4.6 and 4.7; Department for Transport, … Read more
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16 Conclusion
10th Report - HS2: Update followin…
HS2 Ltd revised Phase 1 construction contracts in 2020, increasing its liability for cost overruns.
In July 2017, HS2 Ltd let contracts with four joint venture companies for the main civil construction work on Phase 1. However, in 2020, once the cost of building the railway became clearer, it revised the terms of the contracts … Read more
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17 Recommendation
10th Report - HS2: Update followin…
Previous Public Accounts Committee warned HS2 Ltd about managing revised contracts and cost risks.
However, the previous Public Accounts Committee was clear on the risk of these changes and that HS2 Ltd needed to closely manage these contracts. In its May 2020 report it warned that: “Now that it is bearing more of the … Read more
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18 Conclusion
10th Report - HS2: Update followin…
HS2 Ltd acknowledges suboptimal contract risk management contributed to a £6 billion cost increase.
HS2 Ltd acknowledged that it has not managed these contract risks in an optimal or coherent way.30 In September 2023, HS2 Ltd estimated that the forecast cost of main civil construction work alone had increased by £6 billion (2019 prices) … Read more
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19 Conclusion
10th Report - HS2: Update followin…
HS2 Ltd is seeking to renegotiate unproductive civil construction contracts for better risk allocation.
HS2 Ltd told us that it is now seeking to renegotiate these contracts.32 It considers that the current contracts are unproductive and that reset provides the opportunity for a fair allocation of risk and an opportunity to find different ways … Read more
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20 Conclusion
10th Report - HS2: Update followin…
Major HS2 contractors willing to renegotiate terms for future infrastructure programme opportunities.
We challenged HS2 Ltd on the feasibility of renegotiating existing contacts to deliver significant cost savings given the lack of incentives for the contractors to change terms. It told us that all major contractors have expressed willingness to discuss and … Read more
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21 Conclusion
10th Report - HS2: Update followin…
Committee concerned about contract renegotiation impact on HS2's small and medium enterprises.
We expressed our concern to HS2 Ltd for the potential for the large main contractors to pass any financial consequences of contract renegotiations down the supply chain to the small and medium–sized enterprises, of which HS2 Ltd told us there … Read more
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22 Recommendation
10th Report - HS2: Update followin…
Ensure environmental legislation requirements do not disproportionately increase major public infrastructure project costs.
We challenged the Department on the balance in legislation that needs to be taken between meeting environmental obligations and costs, raising the example of the £100 million cost of a protective ‘bat tunnel’.36 In order to mitigate HS2’s impact on … Read more
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23 Conclusion
10th Report - HS2: Update followin…
HS2 Ltd concluded £95m bat tunnel was most efficient option after considering 15 alternatives.
HS2 Ltd confirmed that it was its decision to build the structure and not one required by Natural England. However, the Department and HS2 Ltd told us that, despite its cost, that they had concluded the ‘tunnel’ structure was the … Read more
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24 Conclusion
10th Report - HS2: Update followin…
Department and HS2 Ltd recognise need for improved balance between environmental compliance and cost.
The Department strongly agreed, however, about how the balance between compliance and cost should be considered when delivering national infrastructure in the future.41 HS2 Ltd also recognised that it was a complex issue and a sensitive area, telling us that … Read more
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25 Conclusion
10th Report - HS2: Update followin…
Bat protection structure increased specific railway section costs from £73 million to £168 million.
In follow–up evidence, the Department confirmed that the total cost of building the structure will be £95 million (in 2019 prices). The Department also reported that the cost of building that section of the railway, irrespective of any mitigation works, … Read more
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26 Conclusion
10th Report - HS2: Update followin…
HS2 Ltd fails to monitor total spending on environmental mitigation schemes.
HS2 Ltd does not monitor how much in total it spends on environmental mitigation. For example, we asked HS2 Ltd how much it was spending on wildlife migration schemes such as for the great crested newt at Halse Copse. In … Read more
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27 Conclusion
10th Report - HS2: Update followin…
Government plans new Nature Restoration Fund for simplified infrastructure environmental obligations.
In January 2025, the government announced that it will look to change how infrastructure projects meet their environmental obligations as part of its forthcoming Planning and Infrastructure Bill. It set out that this would include a Nature Restoration Fund which … Read more
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28 Recommendation
10th Report - HS2: Update followin…
Ensure Department and HS2 Ltd secure necessary skills for successful programme delivery.
The Public Accounts Committee has repeatedly raised concerns over whether the Department and HS2 Ltd have had the necessary skills and capability to deliver HS2 successfully. In 2020 the previous Committee cautioned that it was not yet convinced that the … Read more
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29 Conclusion
10th Report - HS2: Update followin…
HS2 Ltd shifts focus to railway systems and operational capability.
HS2 Ltd also acknowledged in evidence to the previous Committee in November 2023 that it that it needed to think about its capacity and capability throughout the company to deliver the task ahead.47 While HS2 Ltd’s focus in recent years … Read more
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30 Conclusion
10th Report - HS2: Update followin…
New HS2 Ltd CEO to reinforce capability, reduce costs, and focus on Phase 1 delivery.
HS2 Ltd now has new leadership, with Mark Wild appointed as the new Chief Executive Officer and taking up the role in December 2024. He brings his experience of delivering Crossrail into operation and is tasked with delivering the programme’s … Read more
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31 Conclusion
10th Report - HS2: Update followin…
Expanded Euston programme scope includes commercial development, housing, and station redevelopments.
In the October 2023 announcement, the government at the time set out that the HS2 station itself would be planned to be smaller, reflecting the lower number of train services expected to operate following the cancellation of Phase 2. However, … Read more
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32 Conclusion
10th Report - HS2: Update followin…
Department pursues holistic Euston approach, progressing new delivery company and corporation models.
The Department told us that the new approach to Euston is now a holistic one, seeking to build consensus between stakeholders and as a unified delivery rather than the ineffective attempts of the past to try to solve each part … Read more
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33 Conclusion
10th Report - HS2: Update followin…
Department defends new Euston delivery body necessity due to project complexity and private investment.
We challenged the Department over the necessity and added risk of establishing an additional delivery body to oversee the works at Euston and its surroundings. The Department recognised that setting up new organisations is far more complex and difficult than … Read more
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34 Conclusion
10th Report - HS2: Update followin…
Department stresses need for correct financial incentives in new Euston delivery company.
The Department also pointed to the need to get the financial incentives right in the new delivery company, including what the shareholding and financial participation would be between the different bodies, so that people consider the collective interest, not just … Read more
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35 Conclusion
10th Report - HS2: Update followin…
Department anticipates mixed funding for Euston station, including significant private investment.
We also challenged the Department on the likelihood of obtaining the more than £6 billion that the station at Euston is estimated to cost from the private sector. The Department suggested that the funding for Euston would likely be a … Read more
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36 Conclusion
10th Report - HS2: Update followin…
Euston tunneling confirmed, but completion date for HS2 services remains unknown.
In the 2024 Autumn Budget, the government confirmed that HS2 would terminate at Euston, announcing that it would fund the work to tunnel from Old Oak Common in west London to Euston.61 The previous Public Accounts 57 Qq 78–80 58 … Read more
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37 Conclusion
10th Report - HS2: Update followin…
Euston works will cause over a decade of disruption to local communities
The Department acknowledged that establishing a clearer plan for the works at Euston and implementing it will take over a decade and that there will be continued disruption to local businesses and communities at Euston. The Department committed to provide … Read more
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38 Conclusion
10th Report - HS2: Update followin…
HS2 Ltd spent £592 million on land for cancelled Phase 2 route
Up to the end of March 2024, HS2 Ltd had spent £3.7 billion on buying land and property along the HS2 route, of which £592 million relates to the cancelled Phase 2.66 The types of land and property include agricultural, … Read more
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39 Recommendation
10th Report - HS2: Update followin…
Department developing programme for disposing of HS2 surplus land and property
In February 2024, the previous Public Accounts Committee stressed the need for the Department and HS2 Ltd to develop a strategy for the disposal of land and property, and to balance the need for value for money for the taxpayer … Read more
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40 Conclusion
10th Report - HS2: Update followin…
Full disposal of HS2 surplus land dependent on future rail strategy decisions
However, the Department told us that overall decisions need to be made on future rail investment first. It explained that the government’s long– term strategy being developed for strategic rail investment, including on improvements to rail connectivity in the north … Read more
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41 Recommendation
10th Report - HS2: Update followin…
Committee urges sympathetic handling of property offers back to former HS2 owners
We pressed the Department to ensure that wherever possible, properties should be offered back to the persons from whom they were purchased, and that requests from people who would like to move back into their former homes be handled sympathetically, … Read more
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42 Conclusion
10th Report - HS2: Update followin…
Department must balance Crichel Down rules with human impact in property disposal
The Department told us that it is obliged to secure value for money for the taxpayer and to follow the Crichel Down rules, which require government departments to offer surplus land back to the previous owner at the current market … Read more
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43 Conclusion
10th Report - HS2: Update followin…
Phase 2 cancellation limits HS2 capacity benefits to London-Birmingham route
The HS2 programme was originally intended to improve capacity on the West Coast Main Line. However, with the cancellation of Phase 2, the revised programme will only address capacity between London and Birmingham. The Department is exploring options to run … Read more
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44 Conclusion
10th Report - HS2: Update followin…
West Coast Main Line capacity challenge expected by late 2030s due to HS2 changes
The Department acknowledged the capacity challenge on the West Coast Main Line as a consequence of not building Phase 2, estimating that it will reach capacity by the late 2030s. These capacity concerns were also raised with us in evidence … Read more
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45 Conclusion
10th Report - HS2: Update followin…
East-west rail connectivity in the North now considered as series of programmes
The Department told us it is also carrying out development work on how to improve the east–west rail connectivity in the north of England. It said that this may well now be considered as a series of programmes and choices … Read more
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46 Conclusion
10th Report - HS2: Update followin…
Department and HS2 Ltd claim continuous learning from major project experiences
Since 2013, the Department and HS2 Ltd have told the Public Accounts Committee that they have been learning lessons from other major programmes to apply to how they are managing the HS2 programme. For example, in 2019, the Department and … Read more
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47 Recommendation
10th Report - HS2: Update followin…
Department and HS2 Ltd repeatedly fail to embed crucial lessons from major projects
However, the Committee has needed to recommend repeatedly that the Department and HS2 Ltd improve the degree they reflect on past or current experiences and implement any lessons. In 2020, the previous Committee made clear its dissatisfaction: 80 “Given the … Read more
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48 Recommendation
10th Report - HS2: Update followin…
HS2 Euston exemplifies department's failure to learn from past major rail projects
The previous Public Accounts Committee also concluded in its 2023 report on HS2 Euston that it was another example of the Department making the same mistakes and failing to learn lessons from its management of other major rail programmes, highlighting … Read more
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49 Conclusion
10th Report - HS2: Update followin…
Department continues to 'mine' lessons from HS2 programme with other bodies
The Department told us that, together with HS2 Ltd, it has worked with HM Treasury and the Infrastructure and Projects Authority to consider all the lessons to date from the HS2 programme but is continuing to ‘mine’ the lessons learned … Read more
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50 Conclusion
10th Report - HS2: Update followin…
Clear project scope definition essential to prevent cost escalation in infrastructure plans
The Department reflected that a key lesson from the experience of HS2, and which needs to inform all the Department’s future infrastructure plans, is that the Department needs to be very clear when it sets out on a large project … Read more
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51 Conclusion
10th Report - HS2: Update followin…
Incremental delivery of infrastructure projects offers better control and earlier benefits
The Department also suggested to us that the delivery of infrastructure has been too focused on “grand projects or big schemes that are binary—you do them or you don’t do them” as opposed to setting a long–term intent and delivering … Read more
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Correspondence 15 letters
4 Sep 2025 To committee Letter from the Permanent Secretary of the Department for Transport and High Speed Two Limited Chief Executive relating to the 10th Report of Session 2024-25, HS2: update following the Northern leg cancellation, recommendation 1 and 4, 22 July 2025
Parliament page
9 Jul 2025 To committee Letter from the Permanent Secretary of the Department of Transport and the Chief Executive of HS2 Ltd relating to Bat mitigation on HS2, 8 July 2025
Parliament page
8 Jul 2025 To committee Letter from the Permanent Secretary of the Department for Transport and the Chief Executive Officer at HS2 Ltd relating to the recommendations of the Committee's 10th report, HS2: Update following the Northern Leg cancellation, 07 July 2025
Parliament page
3 Jul 2025 From committee Letter to the Permanent Secretary of the Department for Transport relating to the updated estimate of the HS2 bat mitigation structure at Sheephouse Wood, 03 July 2025
Parliament page
30 Jun 2025 From committee Letter to the Permanent Secretary of the Department for Transport relating to the Treasury Minute Response on HS2 update following the Northern Leg cancellation, 24 June 2025
Parliament page
26 Jun 2025 To committee Letter from the Interim Permanent Secretary of the Department for Transport and Chief Executive of High Speed Two Limited relating to the Sheephouse Wood bat mitigation structure, 20 June 2025
Parliament page
9 Jun 2025 From committee Letter to the Permanent Secretary of the Department for Transport relating to the cost breakdown of the HS2 bat mitigation structure at Sheephouse Wood, 05 June 202
Parliament page
19 May 2025 To committee Letter from the Permanent Secretary of the Department for Transport relating to the 10th Report of Session 2024-25, HS2: update following the Northern leg cancellation, Recommendation 2, 4, and 8, 15 May 2025
Parliament page
17 Mar 2025 From committee Letter to the Permanent Secretary of the Department for Transport relating to the HS2 Euston tunnelling schedule, 06 March 2025
Parliament page
4 Feb 2025 To committee Letter from the Permanent Secretary of the Department for Transport relating to the cost breakdown of the HS2 bat mitigation structure at Sheephouse Wood, 31 January 2025
Parliament page
20 Jan 2025 To committee Letter from the Permanent Secretary of the Department for Transport relating to a follow up on HS2 Resident’s and Construction Commissioner role, 10 January 2025
Parliament page
20 Jan 2025 To committee Letter from the Permanent Secretary of the Department for Transport relating to a follow up on questions during the oral evidence session held on 19 December 2024, 10 January 2025
Parliament page
20 Jan 2025 To committee Letter from the Deputy Chief Executive Officer at High Speed Two (HS2) Limited relating to the oral evidence session on 19 December 2024, 10 January 2025
Parliament page
2 Jan 2025 From committee Letter to the Permanent Secretary of the Department for Transport relating to the oral evidence session held on 19 December 2024, 23 December 2024
Parliament page
19 Dec 2024 To committee Letter from the Permanent Secretary of the Department for Transport relating to the publication of the High Speed Two (HS2) Parliamentary Report, 17 December 2024
Parliament page