Northern Council says it faces bankruptcy following removal of HS2 link

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A north-west council has said it faces going bankrupt, blaming the "devastating" impact of Rishi Sunak's decision to abandon the northern part of the HS2.

Cheshire East council has revealed it will have to cancel £11 million spent preparing for the aborted high-speed rail project.

The Independent first revealed in September the radical decision by Mr Sunak and his chancellor Jeremy Hunt to scrap the Birmingham-Manchester route.

Council chiefs and business leaders had warned the government of the devastating impact on investment and the risk that money already committed to the project would be lost. .

Cheshire East Council revealed that around £8.6 million of the money intended for HS2 phase 2 had been borrowed and would have to be found through budget cuts.< /p>

A report cited the "direct and devastating impacts" of ending the rail project, and said it was seeking "a fair and equitable deal to compensate for the losses to the council and the opportunity cost to the borough."

Huw Merriman agreed that a "dialogue between the council and the government would continue" after meeting the council's Labor leader Sam Corcoran.

HS2 site in Birmingham, where the project will now finish

(PA Wire)

The leader of the Conservative Party group in councilor Janet Clowes said there had been “a cross-party rebuke from Cheshire East with the government”. " on the impact of this decision.

The council highlighted a budget black hole of £18.7 million and announced measures to close its head office, reduce working hours opening libraries and introducing new bin charges.

It comes as councils warned Mr Sunak of a rise in effective bankruptcies across the country unless he makes a Last-minute intervention to boost next year's financial settlement for local government.

A letter from the Prime Minister's council leaders highlights an imminent threat to financial sustainability and support. ..