Ministers have did not exhibit how they are going to obtain the promised advantages of the under-construction Oxford-Cambridge rail hyperlink, regardless of spending greater than £1bn on the venture to this point, a watchdog has warned.

The Nationwide Audit Workplace (NAO) mentioned it was “not but clear” how the East West Rail venture would offer the enhance to those cities that was essential to justify its price ticket.

East West Rail is being delivered in three levels, by way of a mix of upgrades, refurbishment, reinstatement and new-build observe.

The primary part is nicely underway, with providers working from Oxford to Bicester Village. The East West Rail Alliance, which incorporates Laing O’Rourke and VolkerRail, is rebuilding the Varsity Line that may carry trains on to Bletchley, on the fringe of Milton Keynes.

Additional levels will see the prevailing observe upgraded to Bedford station, which can be remodelled, earlier than a brand new line is constructed from there to Cambridge.

The NAO mentioned that by March 2023, the Division for Transport (DfT) had already spent £1.1bn on the venture. This was totally on the part between Oxford and Milton Keynes, though £185m had been dedicated in planning for the later phases.

Estimates for the ultimate value of the scheme stood at as much as £6.6bn, the report discovered.

Nonetheless, an evaluation carried out earlier this yr discovered that the benefit-cost ratio for the venture was beneath 1, in keeping with the NAO. Delivered by the DfT and the East West Rail Firm, which was created in 2018 to supervise the venture, this train didn’t embrace oblique impacts.

The strategic case for the road was firmly constructed on boosting financial development within the Oxford-Cambridge arc, the research mentioned, which required cross-departmental working to make sure, for instance, adequate housebuilding.

Nonetheless, preliminary preparations put in place by ministers to create this joined-up working have been deserted in 2021, in keeping with the report. The Treasury lately established a cross-government East West Rail Financial Development Board to speed up the advantages of the venture however this solely started assembly in September this yr.

“As with many transport tasks, the rationale for East West Rail doesn’t relaxation on the power of the benefit-cost ratio for the venture alone – which is poor – however on its wider strategic goal of overcoming constraints to financial development within the Oxford-Cambridge area,” mentioned the NAO.

“This rationale has underpinned DfT’s selections to approve and proceed with the venture to this point. Nonetheless, attaining the mandatory worth from the federal government’s funding in East West Rail would require stronger strategic alignment throughout authorities.”

Public Accounts Committee chair Meg Hillier mentioned: “East West Rail is a £6bn-£7bn funding to assist development in part of the UK that the federal government regards as economically vital.

“Nonetheless, right now’s NAO report says it’s not clear how the advantages of the venture can be achieved or the way it aligns to different authorities plans for development within the area.

“To realize worth from the funding of taxpayers’ cash in East West Rail, authorities have to be strategically aligned. Central authorities and native our bodies should work collectively higher if advantages are to be realised over the long run.”

The doubts over the financial advantages of the East West Rail venture come two months after prime minister Rishi Sunak introduced he was scrapping the northern leg of the HS2 venture.

A spokesperson for East West Railway Firm mentioned: “The NAO report confirms what we set out after we introduced the route – that the case for East West Rail rests on the financial advantages {that a} new railway brings by way of new companies, jobs and funding, reasonably than simply improved connectivity alone.

“As we’ve mentioned, and because the NAO makes clear, not all of those advantages are captured within the typical benefit-cost ratio and due to this fact it’s important that we work carefully with companions in authorities and regionally to verify these advantages are delivered for the communities that we serve.

“The report acknowledges that we’re already doing so, but additionally makes clear that extra must be finished. We welcome that – and are dedicated to working with the federal government to take ahead the NAO’s suggestions.”

The DfT has been contacted for remark.