UK Prime Minister Rishi Sunak has canceled the northern leg of the HS2 high-speed rail project, pledging to invest £36 billion ($44 billion) of savings in alternative transport networks instead.

Sunak said the new track would no longer reach Manchester and instead stop in Birmingham, a decision widely expected after days of rumors. He said it no longer made sense to continue with HS2 after its costs had doubled and following changes to business travel patterns since the pandemic.

"I am canceling the rest of the HS2 project," he told the Conservative Party conference. "We will reinvest every single penny, £36 billion, in hundreds of new transport projects in the north and the Midlands, and across the country." 

To applause from a packed conference hall, Sunak told those who first backed the project years ago that the circumstances in the UK had changed, making the money better spent on roads, underground rail systems and other transport connections in northern and central England.

"HS2 is the ultimate example of the old consensus," he said, pressing his message that he was the politician to change 30 years of an inefficient "political status quo."

HS2 had been billed as Europe's biggest infrastructure project, but costs had soared to over $129 billion at a 2020 estimate from the $68 billion bill forecast in 2015, when the eastern link to Leeds had already been scrapped.

Politicians and business leaders in the North of the UK have repeatedly warned that scrapping the Manchester connection would damage the region's growth prospects and have accused the government of prioritizing investment in the more prosperous south.

"I've never in my 30 years in politics seen a situation where a party comes to a city for its conference and leaves an axe hanging over that place for days and drops that axe as it's about to leave," Mayor Manchester Andy Burnham told numerous UK media outlets.

"We're shut out of this… they are ripping the heart out of what is called the northern powerhouse rail," said the mayor.

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Video producer: Michael Marillier  

Video editor: James Sandifer