There’s a new UK Budget and there’s some big news for British rail. Finance minister Rachel Reeves has said the southern leg of the HS2 railway line should run to central London, and that the government will commit funding to start the required tunnelling. That’s after the multibillion-pound project was significantly scaled back by the previous government.

Presenting the first budget of the new Labour government, Reeves said the high-speed rail project – which will connect the capital city to Birmingham in central England – should extend to Euston station as many in the industry had feared it would not.

In fact, just earlier in the week the head of the UK’s top rail lobby, RIA, wrote a direct letter to Reeves asking not only for her to pledge further investment to the UK’s train sector, but also specifically asking her to sign off on the Euston extension.

Cancellation of HS2 Euston extension overturned

Without new private money, the rail line had been set to stop at Old Oak Common in the outskirts of the capital under former Prime Minister Rishi Sunak. He also cancelled the northern leg of the project between Birmingham and Manchester due to massive cost overruns. Earlier this month, the new Labour government announced that it would be taking a much more active hand in the management of HS2’s construction due to the overspending.

However, it appears that the Chancellor agrees that to make the billions of pounds already spent on the project worthwhile, it will have to reach into the centre of the capital. “We are committing the funding required to begin tunnelling work to London Euston station, catalysing private investment into the local area,” Reeves said.

UK rail happy…

The news was greeted with enthusiasm by many in the rail industry after fears that the Chancellor’s plans to plug a 22 billion pound deficit would trump the infrastructure project. “Rail investment is far more than a short-term cost: it is a driver of national growth and regional connectivity. Today’s approval to complete HS2’s critical link from Old Oak Common to Euston marks a pivotal step forward,” said a spokesperson for the UK’s High Speed Rail Group.

“We hope that an era of fragmented, short-term decision-making has been ended, in favour of a move towards a cohesive vision for the future of UK rail. However, we cannot stop here,” they wrote. “To fully realise the socio-economic benefits of this project, it is critical that Phase 1 is properly connected north of Birmingham to Crewe and beyond,” the spokesperson added.

… but they still want more

Earlier this month, the UK’s Transport Secretary Louise Haigh said that despite the capacity benefits the HS2 network would bring, the government was not in a position to reinstate cancelled networks. That has so far meant there will likely be no extensions to directly connect with the WCML at Crewe, nor a line to Manchester – the most controversial of all the cancellations.

Nevertheless, the High Speed Rail Group was positive: “Taking a long-term, integrated approach to rail delivery going forward will enable HS2 and the broader network to fuel the UK’s economy and enhance productivity for generations to come. For the first time in some years, this Budget sees that future get one step nearer rather than further away.”

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