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The government is set to scrap the eastern leg of HS2 between the Midlands and Leeds, sources have told the BBC.
The Transport Department will instead announce a new rail plan on Thursday, involving £96bn of funding for high speed routes in the North and Midlands.
Sources said the impact of scrapping the Leeds leg of HS2 would make journeys longer by 20 minutes.
But the government is set to argue its new plans will deliver comparable benefits and be quicker and cheaper.
A source told the BBC political correspondent Nick Eardley they would show an "enormous amount of common sense".
High Speed 2 is a planned new high-speed railway line, originally meant to connect London with the city centres of Birmingham, Manchester and Leeds.
However, Conservative MPs have expressed concerns about the cost of the eastern leg connecting the West Midlands and Leeds, and there have been rumours it would be scrapped since the summer.
According to a report in the Sunday Times this weekend, Transport Secretary Grant Shapps will instead announce two shorter high-speed routes created in part by upgrading existing lines. One will run between Leeds and Sheffield, another from Birmingham to East Midlands Parkway.
The government is also expected to put money aside to explore setting up a tram service for Leeds.
The Northern Powerhouse Partnership, a group of northern local authorities and business leaders, said the decision to scrap the Leeds leg of HS2 was a mistake.
Director Henri Murison said: "The reported loss of any of the new line on the eastern leg of HS2 is damaging, reducing the benefits of the section being built now between Birmingham and London.
"Without the benefits to areas such as Yorkshire and the North East, HS2's status as a project to drive the whole of the UK is undermined considerably."