Sky News announced the rumour minutes before Chancellor Jeremy Hunt took to the stage at the Conservative Party Conference.
Speculation about the future of the project has been circulating for weeks, but both Hunt and Sunak have refused to comment on the future of this section of the high-speed rail link a number of times.
HS2 was given the go-ahead in 2020, despite a decade of sharply rising costs and repeated delays to the original project timeframe. The cost of completing the project has ballooned from £33bn a decade ago to an estimated £100bn today.
The Independent recently reported that ministers were considering shelving the northern phase amid concerns about increasing costs and severe delays. It said a cost estimate it had seen revealed that the government has already spent £2.3bn on stage two of the railway from Birmingham to Manchester. Scrapping this phase, though, could save up to £34bn.
There are no reports on whether the line from London...