Midland Mainline Electrification Pause Risks £70m Taxpayer Loss and £400m Economic Impact

The government’s decision to suspend the next phase of electrification on the Midland mainline from London to Sheffield could cost taxpayers up to £70 million, while also jeopardising nearly £400 million in economic benefits, the rail industry has warned. The paused upgrade, which would extend electrification beyond South Wigston in Leicestershire, has raised concerns over its potential impact on jobs, economic growth, and rail decarbonisation targets.

A letter issued to Lord Hendy of Richmond Hill by Rail Forum and the Railway Industry Association criticised the decision, citing a “lack of whole-system thinking”. The groups warned that halting the project indefinitely would result in significant losses across the UK rail supply chain and undermine future efforts to deliver cost-effective electrification schemes. The sunk costs associated with the project pause are estimated between £50 million and £70 million.

Industry organisations are calling for the government to bring forward the restart of the project to within the next year, stating that the planned extension could provide tangible economic benefits. The proposed upgrade is expected to generate approximately £400 million for the UK economy while creating as many as 5,000 jobs. The project had previously been described as “shovel-ready”, and experts argue its suspension makes little sense considering its alignment with decarbonisation goals.

The Department for Transport defended the decision by pointing to the time and financial investment needed to electrify the remaining stretch of the line. Officials indicated that resources would instead be directed towards other projects, including the TransPennine route between Manchester and Leeds and the east-west rail link between Cambridge and Oxford. It stressed that full electrification for the Midland mainline would remain under review as part of longer-term decarbonisation plans.

The suspension, however, will ensure that over 6,000 miles of travel per day on the route to Sheffield and Nottingham continue to rely on diesel trains. This reliance on outdated technology stands in contrast to the government’s goal of achieving a fully decarbonised rail network by 2050. Critics argue that the delay in electrification could hinder sustainability efforts and detract from broader environmental policy commitments.

Elaine Clark, chief executive of Rail Forum, expressed disappointment at the decision, stating, “It is a project ready to deliver tangible results within this parliamentary term, unlike other schemes that may face far longer lead times.” Proponents of the project stress that pausing the initiative risks missing key opportunities for economic recovery and innovation in the rail sector.