A report released today by the Institute of Economic Affairs claims that the High Speed 2 (HS2) project is ‘economically flawed’.
The report, High Speed 2: the next government project disaster?, also says the scheme is not ‘commercially viable and asserts that taxpayers will bear a high proportion of the financial risks’.
The research found that policymakers in favour of HS2 are making their case on the ‘basis of bogus assumptions’.
The report claims that ‘huge’ Government subsidies on the existing rail network mean that ‘prices and demand levels are severely distorted’.
The Institute also claimed that demand growth estimates are ‘optimistic’.
The first stage of the project, if approved, will begin construction in 2016, with further stretches to Manchester, Leeds and Scotland in the pipeline.
Supporters of the line believe it will regenerate business growth between the north and south but opposers think HS2, which is set to run through Areas of Outstanding Natural Beauty, is too expensive and will be detrimental to the countryside.
‘Significant environmental and social costs’ are not included in the assessment of the economic case, with several areas likely to be affected by ‘planning blight’, the report says.
The ‘green’ credentials of the scheme are ‘highly questionable’, the report says. At 225mph, the trains will be the fastest in Europe and ‘will consume disproportionate levels of power via the National Grid’.
Commenting on the report, Dr Richard Wellings, Deputy Editorial Director at the Institute of Economic Affairs and co-author of the report, said:
“High Speed 2 is another political vanity project – like Concorde and the Millennium Dome – being ploughed ahead with complete disregard for properly thought-through commercial prospects or the mounting opposition to it.
“Its environmental credentials are questionable, its projected passenger figures suspect, and its proposed regenerative effects highly dubious.
“Proceeding with HS2 plans is a recipe for disaster and, as always, it will be the forever-embattled British taxpayer who will end up footing the bill for this latest white elephant.”
For months now the Government and the pro-HS2 lobby have treated with contempt the evidence presented to them that HS2 is not in the national interest. Now that a respected think tank has come up with a report that confirms precisely that, the Government owes it to the country to sit up and take note. As the public consultation will no doubt confirm, the public are extremely sceptical about shelling out at least £34 billion on a project like this – at a time like this. We have a huge debts to pay off, and if the Eurozone crisis ends as catastrophically as many analysts now believe it will, we may well need to set aside billions more to bale out Ireland and other European partners. We need to take stock, improve existing public transport services, and invest instead in building a digital economy, based on ultra-high-speed broadband for all. Within a few years there’ll be far more virtual meetings than real ones, and we’ll look back and marvel that we used to waste so much time and money travelling to and from meetings, contributing to global warming in the process. By all means revisit the idea when we’re back in the black. And if we still think high-speed rail is worth ripping up more of our precious countryside for, let’s go for truly cutting-edge technology. Maglev and vactrains are faster, quieter, cleaner and cheaper to maintain than the old-fashioned technology the Government is proposing for HS2.
What evidence?
All that the anti-hs2 mob have presented is speculation and nonsense.
The IEA, a respected think tank? I’d be suprised if anybody had heard of it before yesterday.
The IEA is a right wing Thatcherite group that supports many cost cutting measures including the abolition of the NHS. As for transport their policy is to stop public investment and only rely on private funding.
If you want road tolls to be introduced, then support the IEA now !
Money spent on HS2 is well spent money which mainly stays in the country and boosts the economy. If the figures are too optimistic and more money is spent even the better.