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HS2 is a ‘Vanity Project’ and ‘Recipe for Disaster’

HS2 Logo & High Speed Train

The High Speed 2 (HS2) rail project planned by the government to connect London with Birmingham has been labeled ‘economically flawed.’ According to a report from the Institute of Economic Affairs (IEA), the project will need to have a £1,000 contribution per income taxpayer and isn’t commercially viable. The Department for Transport (DfT) says that the project will help drive economic growth, while prime minister David Cameron said last month that the government is committed to the project.

The whole HS2 project is due to cost £32 billion, with the London-Birmingham link costing £17 billion, and it’s anticipated to be completed by 2026. The route is due to run through rural parts of Buckinghamshire, Northamptonshire, Oxfordshire, Staffordshire and Warwickshire. The other £15 billion in project costs is to be used for a Y-shaped extension from Manchester to Leeds and futher north, which is to be completed around 2032-33. However, the DfT claims the rail line will deliver £44 billion in economic benefits.

The IEA says that HS2 is a political vanity project and has been planned on bogus assumptions. Estimates from the government for demand on the route are very optimistic. The report continued that the first 5 miles of the rail line from London Euston station to Old Oak Common will add nearly £4 billion (25%) to the cost of the first phase but will provide negligible time savings. Significant social and environmental costs also have been included in the economic case assessment, with many areas likely to be affected, it continued, adding that the environmental credentials are highly questionable. The authors claim that the trains will be Europe’s fastest at 225mph but will consume disproportionate power levels from the National Grid.

Dr Richard Wellings, the deputy editorial director for the IEA, says that HS2 is another vanity project like the Millennium Dome and Concorde and is being pushed with complete disregard for accurately thought through commercial prospects or the increased opposition to it. Aside from questionable environmental credentials, its proposed regenerative effects are very doubtful and projected passenger figures are suspicious. The decision to push on with the plan is ‘a recipe for disaster,’ and it will be the taxpayers who will have to pay ‘for this latest white elephant.’

Speaking against the report, the Campaign for High-Speed Rail said it is very shocked and disappointed with the views. Director Professor David Begg says that the IEA completely failed to understand the bigger benefits of the project, which will spread the nation’s economic wealth, boost investment and create jobs. The claim that each taxpayer will have to pay £1,000 for the rail line is based on research that hasn’t stood up to industry or public scrutiny. It also fails to account for generated taxation, private investment and fare revenues that will offset the public investment.

A spokesman for the DfT also responded to the report, saying that the IEA is saying that the alternative is for the government is to halt investment into railways and do nothing as rail fares rise, crowding increases and performance deteriorates. However, the government believes in backing railways as a way to drive economic growth, provide a greener alternative to short-haul flights and extra driving, as well as improve connectivity.



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