Cost of UK's new high-speed rail line soars to $138 billion

LONDON -- The bill for Britain's new high-speed railway line, HS2, could climb to as much as 103 billion pounds ($138 billion), transport minister Heidi Alexander announced on Tuesday, revealing the latest cost overruns to the beleaguered infrastructure project.

HS2 was originally designed to add capacity and help Britain catch up with other European countries which have extensive high-speed networks.

But its spiralling budget and project delays, meant successive governments significantly scaled back the length of the new line, putting the whole future of the project at risk.

On Tuesday Alexander said new analysis showed cancelling now would cost as much as carrying on.

She said the line, which will link central London and Birmingham, was now estimated to cost between 87.7 billion pounds and 102.7 billion pounds and services would not run until between 2036 and 2039, more than 10 years later than originally scheduled.

"Taxpayers, passengers and communities along the route have been let down by years of mismanagement on HS2," Alexander said, adding that she was confident in a new management team which had previously delivered London's Elizabeth line.

NO CENTRAL LONDON STOP UNTIL AT LEAST 2040

Trains into central London's Euston station will not be operational until between 2040 and 2043, and services running before that will terminate at Old Oak Common in west London.

Alexander blamed previous governments for their decision to build a bespoke and highly engineered railway with the world's fastest trains, and said inefficient delivery, underestimation and inflation were behind the soaring costs.

HS2 was designed to improve connections between London and northern England, as well as modernising Britain's mostly Victorian-era railway network. It was expected to cost 32 billion pounds in 2011.

But connections to the northern cities of Leeds and Manchester were scrapped in the early 2020s as the bill ballooned. It was estimated at 56 billion pounds in 2018, with multiple reports since putting it closer to 100 billion pounds.

($1 = 0.7456 pounds)

-Reporting by Sarah Young, editing by Paul Sandle/Reuters