(Bloomberg) -- Rishi Sunak may announce a decision to scrap a key section of the flagship HS2 high-speed railway line this week, adding to a series of recent policy shifts as the prime minister prepares the party for an election campaign, the Observer reported.  

Sunak is scheduled to meet Chancellor Jeremy Hunt this week and may disclose the decision to cancel the northern section of the HS2 before his Conservative Party conference opens in Manchester on Oct. 1, according to The Observer newspaper. That link connecting Birmingham with Manchester was a key part of the Tory “leveling-up” pledge to close the economic gap between London in southern England and the more industrial north of the country.

The upper estimate of building the initial London to Birmingham stretch of the rail link has increased by more than £8 billion ($9.8 billion) from the £45 billion figure published in June 2022, according to a separate report by Telegraph newspaper.

“We do have to respond to the budgets,” UK Defence Secretary Grant Shapps said in an interview with the BBC on Sunday. “We have been hit not just by coronavirus but also by war in Ukraine and I think any responsible government looks at that and says does this still stack up for what the country requires in terms of where it’s spending its resources?”

If announced, the u-turn would come just days after Sunak’s decision to delay a ban on the sale of new fossil-fuel cars by five years to 2035, which he framed as a “new approach” to tackling climate change as Britons are buffeted by high inflation and a cost-of-living crisis. Sunak has also announced an easing of rules on when some Britons must replace oil and gas boilers with heat pumps


Sunak is expected to announce further policy changes on housing, infrastructure, immigration and industrial policy over the coming weeks as he shifts into election mode ahead of a vote due before January 2025, people have told Bloomberg. He is trying to energize the Tory base to overcome the opposition Labour Party’s 20-point lead in national opinion polls. 

Other possible changes include a cut to the nation’s inheritance tax, The Sunday Times reported. Sunak is also mulling a tweak to green rules to help speed the construction of up to 140,000 new homes, The Sunday Telegraph newspaper reported. Shapps Sunday called the inheritance tax “deeply unfair,” without confirming whether it would be changed. 

Sunak is “prepared to take the difficult decisions. Not always the popular decisions at that moment in time, but the right decisions long-term for this country,” Shapps said in another interview with Sky News.

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