Question to the Department for Transport:

To ask His Majesty's Government whether the most recent cost estimates for High Speed 2 include finance costs, or charges on the public money that will be spent on the project, in accordance with Treasury requirements and the government financial reporting manual; and what debt ratio, discount rates and assumptions were used.

The HS2 project is funded via capital contribution by the Department for Transport (DfT). Financing costs or charges on public money are not incurred by HS2 Ltd. As a Non-Departmental Public Body, HS2 Ltd also adopts the interpretations of Internation Financial Reporting Standards (IFRS) and additional disclosure requirements contained in the Government Financial Reporting Manual (FReM) for the relevant financial year, where these are compatible with the requirements of the Companies Act. HS2 Ltd does not have debt as the Company is fully funded by HM Treasury/DfT. The key assumption for cost estimates is that they are currently presented in Q3 2019 prices. Regarding discount rates, the DfT’s Economic Appraisal of HS2 as presented in the “Phase One Full Business Case” (April 2020), which included the expected benefits, Ticket Revenues, construction costs and Operating Costs, were all discounted and presented in Net Present Value (NPV) terms in line with the DfT Transport Analysis Guidance (TAG) and HM Treasury Green Book guidance.