The M62 J20-25 project between Rochdale and Brighouse was originally conceived as a smart motorway scheme but had already been down-sized to a central reserve upgrade.

Now the projected cost of the 19-mile central reserve upgrade has soared so high that National Highways has axed the scheme.

It will now syphon off allocated funding for the M62 to top up the M1 J10-13 planned motorway scheme which is also forecast to exceed the original budget and had struggled to get final sign-off.

Costain recently completed works on a big works compound for the M62 job and will have to demobilise its team.

National Highways said it would work hard to explore opportunities for transfer of colleagues on to other schemes, as well as develop next steps for planned, closure and handover of the scheme and assets.

National Highways managing director of the Smart Motorway Alliance Tony Slater told firms that extensive forecasting exercises for the M62 J20-25 scheme projected the full scope cost would be 60% above the available budget.

Slater said that even after trying cuts to scope, Costain’s projected cost would be 10% above the available budget.

He said: “Frustration will be felt most profoundly by everyone who has been working hard on the M62 J20-25 scheme.

“The decision to stop work this scheme is hugely challenging to me, our Alliance members and our suppliers, and it is a decision we have tried very hard to avoid.”

Slater said he acknowledged there were still challenges to overcome on other projects including the M6 J5-8, M6 J8-10a and M42 J4-7 dynamic hard shoulder schemes.

He said: “These challenges are still being discussed and actively worked through – a further review of M6 J8-10a and M42 J4-7 schemes will be conducted as soon as we have finalised discussions, no later than September.”

The decision is another blow to Smart Motorway Alliance firms who late last month saw the Government confirm the paused Smart Motorway Programme would be abandoned after a 16-month long safety review.

Eleven projects already paused and three more earmarked for construction during the third Road Investment Strategy (2025 to 2030) were removed from government road-building plans.