Cabinet Office ‘brushed aside warnings about HS2 fraud'

Telegraph

7 hours ago

The Cabinet Office brushed aside concerns about fraud and financial mismanagement at HS2.
Lord Berkeley, the Conservative peer, had urged the government department to open an inquiry into claims that the high-speed rail project was set to cost billions of pounds more than Parliament had been told.
He warned that HS2 had been 'promoted and procured by deception and possibly fraud from the start 10 years ago'.
Lord Berkeley demanded an investigation into potential breaches of the ministerial code, something that Sir Simon Case – the then cabinet secretary, to whom he wrote – could not do.
The Tory peer had alleged that ministers misled Parliament by falsely promising that HS2 would cost less than they knew it would, risking fraud going undetected.
'Fraudulent so-called activities'
'I did want to complain to the Cabinet Office while [Sir] Simon Case was there and suggested that they did an investigation into all the fraudulent so-called activities of HS2,' Lord Berkeley said. 'And his answer was, well, we need to get the Prime Minister's approval before we do anything like that, and he's unlikely to approve of it.'
It comes after HMRC launched an investigation into an HS2 contractor accused of tax fraud by submitting 'fake payslips' to disguise self-employed workers as directly-employed staff.
The company in question provided staff to Balfour Beatty Vinci (BBV), one of the main contractors on HS2. There is no suggestion of wrongdoing by BBV.
Lord Berkeley's concerns, first expressed in 2019, were that HS2's true cost to taxpayers was far in excess of the £55 billion earmarked by ministers.
In correspondence seen by The Telegraph, he wrote: 'It is clear that the Prime Minister, his predecessors and other ministers were made aware of the probable out-turn cost, but none chose to inform Parliament.
'I therefore believe that the project has been promoted and procured by deception and possibly fraud from the start 10 years ago, a process that has allowed the project to proceed in stages to ensure that the true costs will only come out when it is too late to change or cancel.'
Sir Simon wrote back to Lord Berkeley explaining that breaches of the ministerial code could only be investigated by the Prime Minister – at the time, Boris Johnson – and not the Civil Service.
The former Cabinet secretary, who stepped down at the end of last year on health grounds, told The Telegraph: 'Lord Berkeley deserves credit, certainly, for raising the alarm so early on.'
The Telegraph understands that in subsequent correspondence, the peer eventually raised his concerns about potential breaches of the ministerial code directly with Mr Johnson.
News that potential fraud at HS2 was raised years ago comes as the Labour Government admitted that the high-speed railway line was in an ' appalling mess ' and would be delayed once again beyond its current opening date of 2033.
Heidi Alexander, the Transport Secretary, promised that the Government would be able to turn the project around but said on Wednesday that there was 'no route by which trains can be running' by the target date.
An HS2 spokesman said earlier this week: 'We treat all whistleblower allegations seriously and are continuing to conduct our own investigation.'
The Department for Transport said it has 'a zero-tolerance attitude towards fraud, bribery, and corruption' and would ensure any claims of wrongdoing were thoroughly investigated.