A damning report by watchdog MPs on the Public Accounts Committee said the scheme is “floundering” as cost estimates for its construction rise to £4.8bn from an original £2.6bn.

The government announced in March that work on the station will be paused for two years in a bid to cut costs.

Dame Meg Hillier MP, Chair of the Committee, said: “The HS2 Euston project is floundering. This is a multi-billion pound scheme which has already caused major disruption to the local community put on pause.

“The pause, ostensibly to save money, is not cost free – mothballing and possible compensation for businesses which have lost work will all need to be added to the HS2 tally. The Government must now be clear what it is trying to achieve with this new station, and how it will benefit the public.

“Our report finds that a wildly unrealistic budget for HS2 Euston was set in 2020 in the expectation that it would be revised.

“The Government must demonstrate that that it is not just repeating the same mistakes of unrealistic costings. HS2 Euston has shown us that forging ahead over-optimistically in an unclear direction is clearly not the right approach.”

The report added:” The PAC is also unconvinced that the impact for the DfT’s supply chain, in particular for smaller businesses involved in the works, will be mitigated by their employment elsewhere on the HS2 scheme.

“Questions also remain as to how the Government will manage high levels of inflation on the HS2 programme. The PAC’s inquiry heard the HS2 project is seeing 30% to 40% swings in the cost of raw materials.”