By Elizabeth Piper, Andrew MacAskill and Alistair Smout

MANCHESTER, England (Reuters) -British Prime Minister Rishi Sunak cancelled part of a high-speed rail project on Wednesday, ending weeks of uncertainty and provoking anger in his Conservative Party as he sought to reinvent his premiership as one of tough decisions and action.

With the governing Conservatives badly lagging the opposition Labour Party in polls before an election expected next year, Sunak and his team say he is a politician willing to take long-term "tough decisions" to make people better off.

But his flagship "tough decision" to stop the construction of the HS2 high speed rail line to Manchester in his closing speech at the party's annual conference in that city drew widespread criticism.

Ending days of speculation over the second phase of the project, he told his party: "I'm ending this long-running saga. I am cancelling the rest of the HS2 project. And in its place we will reinvest every single penny - 36 billion pounds - in hundreds of new transport projects in the north and the midlands, across the country."

To applause from a packed conference hall, Sunak told those who first backed the project years ago that the circumstances in Britain had changed.

"Hs2 is the ultimate example of the old consensus," he said, pressing his message that he was the man to change what he described as 30 years of an inefficient "political status quo".

One of Sunak's predecessors David Cameron, who had backed the project when he was Conservative prime minister, said the decision as wrong.

"It will help to fuel the views of those who argue that we can no longer think or act for the long-term as a country; that we are heading in the wrong direction," he said on social media.

Businesses have invested heavily to start construction and some Conservatives, particularly a regional mayor and party favourite in central England, are big supporters of the scheme.

Laurence Turner, head of research and policy at the GMB trade union, said the decision would cost jobs. "We can't rebalance the economy or fix the railway capacity crisis without HS2. It's essential that the planned route is now protected so that a future government can reverse this disastrous decision."

Sunak's supporters say it is proof he can withstand criticism in his pursuit of making the "right decisions" rather than politically expedient ones, pointing to his recent move to water down measures to reach climate targets.

Alan Yonge, 38, who works in digital strategy and listened to the speech in the conference hall, said he welcomed the HS2 announcement, but doubted it would change the polls.

"No one speech can change the fortunes of the party. It did show that we can be the party of change. But I still think it is going to be very hard to win the next election," he said.

LABOUR AHEAD

A Savanta poll published on Wednesday gave Labour a 19 point lead over the Conservatives, suggesting that a small Conservative recovery last week had all but disappeared.

Sunak was introduced by his wife Akshata Murty, who described her husband as her "best friend" before he spoke about reforming Britain's National Health Service, the banning of cigarettes for younger smokers and a plan to introduce a new advanced British standard qualification in schools.

He took aim at Labour leader Keir Starmer, saying he was part of the out-dated system - a taste of what is gearing up to be an ugly election campaign.

"The Labour Party have set out their stall: to do and say as little as possible and hope no one notices. They want to take people's votes for granted and keep doing politics the same old way," he said.

"It is about power for the sake of power. It is in short, everything that is wrong with our politics."

As the party's conference draws to an end, his team will be watching for the response to his new approach and specifically his decision on cutting the second phase of HS2, which has seen 2.3 billion pounds spent already.

Earlier, business leaders accused Sunak of doing the exact opposite of his speech - being driven by short-term political gain rather than considering the value a new high-speed train line could offer generations to come.

Andy Street, a Conservative mayor for a part of central England and a darling of the party for his area's redevelopment, said he had thought "long and hard" about his future in the party but had decided not to resign, in part due to investment the prime minister had pledged for local transport.

"I am incredibly disappointed," he said on social media, adding that he remained committed to the idea. "HS2 was never meant to reach Manchester until 2041, and so I am convinced we can find a way to get back on track."

(Reporting by Elizabeth Piper, Andrew MacAskill and Alistair Smout, Additional reporting by William James, Sarah Young, Farouq Suleiman, Sachin Ravikumar and Kylie MacLellan, Editing by Philippa Fletcher)