The chair of HS2 Ltd is set to step down, the Department for Transport (DfT) has announced as it revealed yet another cost rise for the project.

Sir Jon Thompson, who was a veteran civil servant before taking his role at the government-back delivery body, will step back from his role in the spring after four years on the board.

In a statement, transport secretary Heidi Alexander thanked Thompson for providing “ strong leadership during challenging times for the project”.

Source: Department for Transport / Flickr

Heidi Alexander addressing a DfT all-staff meeting to welcome her as new transport secretary

The news came alongside the DfT’s six-monthly update to parliament on the progress of HS2, which revealed that the predicted cost of the scheme at completion had risen to stand at between £54bn and £66bn.

This compares to the previous estimate of between £45bn and £54bn.

But Alexander said the latest estimate, which was presented to HS2’s board in June, did not take into account the new government’s work to reset the project or factor in private financing for Euston.

“We do not think these figures are accurate or reliable,” she added.

Alexander, who recently took on the secretary of state role from Louise Haigh, said the coming months would see “fresh leadership” under HS2’s new chief executive Mark Wild, with the government working “to grip budgets and deliver the line cost-effectively for passengers and taxpayers”.

Jon Thompson will step down next spring

Wild, who was previously responsible for delivering the Crossrail project, formally began as HS2 Ltd’s new chief executive at the start of the month.

>> Read more: HS2 cuts will leave line as a ‘monument to British mentality’, Manchester mayor says 

Wild has been asked to undertake an assessment on cost, schedule, capability and culture and to provide an action plan for delivering remaining work as cost-effectively as possible.

“Until Mark Wild concludes this work, the government cannot be confident in the forecast outturn cost of the project,” said Alexander. 

“We are, therefore, managing HS2 Ltd’s delivery through annual funding and delivery targets for this financial year and next but with reduced delegation on contingency. 

“It will also be necessary to agree longer-term funding for HS2 in the spending review, due to conclude next year.”

Alexander said most costs for the project were “within the supply chain” and that improved cost control would require engagement with these companies.

Alexander restated that the government had no plans to reinstate the northern sections of HS2 but said the department has met with the mayors of Greater Manchester and the West Midlands about proposals for a lower cost option.

She said the government would set out its plan for strategic rail investment north of Birmingham “in due course”, including its approach to the Crewe-Manchester hybrid bill.

The update – the first since November 2023 after a year disrupted by a change in government – also revealed that the government had completed “a small number of pilot sales” of land north of Birmingham.and is developing a programme to further dispose of land.

While the forecast date for initial HS2 services between Birmingham and Old Oak Common is still between 2029 and 2033, there is still no current schedule estimate for delivering Euston.