Cheshire East Council has warned that it may have to issue a section 114 notice after spending £11m preparing for HS2, as it continues to press for compensation.
The local authority described the cancellation of the HS2 scheme north of Birmingham as a ‘devastating blow’ for the region.
A council report notes that under local government accountancy regulations, the authority will be required to write off the £11m it spent preparing for HS2 and the Crewe Hub, including expensing £8.6m of capital costs through its revenue account.
It warns that this requirement could leave the council with insufficient funds and reserves to manage its in-year expenditure, which could ‘trigger a s114 notice’.
According to the council, the HS2 leg, which would have seen 5-7 trains an hour call at Crewe station, was set to create 4,400 new homes and 5,000 new jobs for Crewe, and provide a £750m annual boost to the local economy.
The authority noted that while some parts of the Government’s ‘Network North’ plan, announced on the back of the HS2 cancellation, could benefit the region, the plan ‘includes no specific mention of investment in Cheshire East or Crewe’.
But because the Government has since described the plan as ‘illustrative’, the council said it understands ‘that there is an opportunity to seek to negotiate a fair and equitable deal for Cheshire East’.
The council has already written to ministers to call for compensation.
