Report questions viability of HS2 scheme

The scheme is branded a waste of money which will cost billions more than expected and go way over its deadlines.

Rich Man’s Toy: The Case for Scrapping HS2 has been produced by The Taxpayers’ Alliance.

Its findings could boost the argument for scrapping the scheme which recently changed its proposed route through South Yorkshire, cutting through Aston, Bramley, Mexborough and the Dearne Valley prompting widespread criticism.

The report, by policy analyst Harry Fairhead, suggests that:

• The rising costs of HS2 are likely to push up to more than £80 billion, way more than the Department for Transport’s 2015 estimate of £55.7 billion;
• The scheme is likely to run over time by many years;
• Passenger demand for HS2 has been exaggerated;
• New technology means people can work on trains thus wiping out the need for shorter journey times, and driverless cars could mean people prefer to work while travelling by road in the future;
• The North will not benefit as London will reap the rewards of HS2 more than anywhere else;
• The UK scheme is much more expensive than other high speed rail links around the world.

The report, which has been condemned by the Department for Transport, concludes: “Before any more money is wasted on this project it should be shut down and the earmarked funds should be spent on more useful projects that offer greater value for money for taxpayers.”

The Taxpayers' Alliance report said that the estimated official costs of HS2 have been rising steadily from £30 billion in 2010 to £55.76 billion in 2015 but says that independent estimates push it up to at least £80 billion.

It says that HS2 will be “significantly more expensive” at £51.3 million per kilometre than other high speed rail projects such as those in Spain (£6.6 million per kilometre), Germany (£21.2 million per kilometre) and Italy (£43.4 million per kilometre).

The report also suggest that promised European links have now been cut out of the project which reduces its “functionality”.

The report says that the Infrastructure Project Authority has given HS2 an Amber-Red assessment this year on the confidence of meeting its delivery dates, and added: “This reflects HS2 Ltd’s acknowledgement that there is a 40 per cent chance that they will fail to deliver Phase One by the target date of 2026.”

The report says that the Department for Transport has failed to consider that the development of wireless communications will allow people to work on trains, which means they don’t need to get to their destination faster, and that many people have fixed work days anyway.

It also suggests that technology may bypass HS2 in the form of more “autonomous vehicles” (driverless vehicles) which are being developed by a number of companies at present and are likely to be advanced by the time the line is completed. Since most people travel by road, the fact that more will be able to work in their vehicles counters HS2’s argument that people would work on trains.

The report says that rather than boosting the north, the line will widen the gap between the capital and the country beyond.

It says: “Reduced transport costs between London and the North of England may actually increase disparities rather than reduce them.”

The reports suggests that rail infrastructure has failed to spread economic growth in countries like South Korea and France.

It also highlights that an Institute of Directors report suggested that a third of business people questioned thought that London would benefit most from HS2.

The report said: “Whether or not the development of the Northern Powerhouse strategy is of merit is immaterial; its creation is being used as part of the justification for the HS2 project and yet there is strong evidence that HS2 will have the opposite effect.”

The Taxpayers’ Alliance also says that demand for high speed rail travel has been lower than forecast in countries such as France.

The report said: “That HS2 is expected to cost a very large amount of taxpayers’ money is a problem as there may be better uses for it” and suggests that electrification of suburban routes could benefit more travellers.

It also says that since figures show that wealthier people tend to use rail over poorer people, spending billions on rail is unfair.

Jonathan Isaby, chief executive of the Taxpayers’ Alliance, said: “HS2 is a wasteful vanity project which is unlikely to be completed on schedule and will cost taxpayers a fortune.

“The new Prime Minister should now be pursuing bold and imaginative policies to boost economic growth and increase productivity — and that positive approach must include scrapping HS2, which has cost taxpayers far too much already.

“Ministers should instead be embarking on more worthwhile infrastructure projects that will cost less and deliver far better value.”

Responding to the Taxpayers’ Alliance report, a spokesperson for the Department for Transport said: “The case for HS2 is absolutely clear. It will create jobs and skills now and will help spread opportunity and growth in the longer-term and bring our country closer together.

“The economic benefit of HS2 has been recognised by MPs of all parties and is strongly supported by Northern and Midlands cities. The National Audit Office has confirmed HS2 is on track and the Transport Select Committee also said it is confident the scheme is the only practical way to significantly increase rail capacity.

“We keep a tough grip on costs and are on schedule to deliver the scheme on time and budget.”