Government officials are said to be planning to raise a minimum of £3bn from private sector investors to fund the new HS2 station at Euston and refurbish the adjacent mainline terminus.
According to The Times, senior figures at the Department for Transport are considering reviving a version of the contentious private finance initiative (PFI), which was significantly expanded under Tony Blair's leadership, as reported by .
Despite criticism that they failed to provide taxpayers with value for money, PFIs for new infrastructure projects were abolished by the Conservative government in 2018. Currently, approximately £52bn of total PFI contracts still exist, involving private sector investors providing upfront funding for public sector projects.
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Reportedly, transport officials' plans for Euston include key features of PFI, and they are pushing for Treasury approval to announce a tender where private investors would be offered a long-term concession. It has been reported that private investors would contribute at least £3bn and receive a payment for every passenger who passes through the barriers over a specified period, with the government contributing around £700m.
The scheme is reportedly in its early stages and would require Treasury approval for public funds to be used to construct a 4.5-mile tunnel between Euston and Old Oak Common station in north-west London for HS2 services.
Earlier this month, Transport Secretary Louise Haigh gave a strong indication that an announcement regarding Euston as the southern terminus for HS2 would be forthcoming. The cost for the tunnel is projected to be around £1bn.
There have been indications that a final verdict on the private finance initiative (PFI)-style proposal for Euston may not be made until the spending review scheduled for next spring.
Commenting on the matter, a government spokesperson said: "We are reviewing the position we inherited on HS2 and will set out a plan in due course."
This update follows reports from the Financial Times in August which suggested that Chancellor Rachel Reeves was exploring a PFI-style agreement to finance the Lower Thames Crossing road tunnel project, estimated at £9bn.