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It's not, so far as I can tell, saying that the project cannot be done. The Red rating, equivalent to unachievable, is measuring against the goals set for the project, including financial.
So what this is saying (or rather confirming) is that it's not achievable based on the current project goals. Or to put it another way, it's over budget and cannot be delivered within budget.
So yeah, still not great that we can't deliver something like this on budget, but if you look in to how it was originally costed for the business case there are holes in the logic large enough to drive several high speed trains through. Sideways. Hopefully the benefits are large enough that they still go through with it, but I suspect that's largely dependent on which narratives take hold during the run up to the next election and whether the Tories can gaslight people in to thinking that country finances work the same way as personal finances.