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HS2 and wider economic costs

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Some years ago, the concept of ‘wider economic benefits‘ was introduced into British cost-benefit appraisal, where it has proved particularly helpful to rail projects.

The neutral term ‘wider economic impacts’ is often used, but in practice, items recognised in extended appraisal tend to be benefit-, rather than cost-oriented. In the August 2012 Economic Case update, HS2 Ltd stated that its high speed rail Y network had a benefit cost-ratio of 1.9 before wider economic impacts, and 2.5 when they are included. However, HS2 assessment of wider economy impacts is strangely selective about what is, and is not, monetised.

On 6 June 2012, the Birmingham Post reported that “Birmingham Airport could move to be closer to HS2”.

Birmingham Airport passenger terminals could be moved more than half a mile east to be closer to the planned HS2 interchange.

The airport’s runway and airside operations would remain where they are while handling operations – such as check-in, baggage handling and security – would move closer to Birmingham International station, according to chief executive Paul Kehoe.
[…]
He told a New Civil Engineer’s Airport Design and Engineering conference in London, that he wanted to embark on a consultation about moving the terminals.

“This could result in moving the airport one kilometre eastwards,” Mr Kehoe told delegates. “It may sound daft but it has to happen.

In West London, construction of HS2 would entail widespread disruption of the road network. Although the work would be phased, there is no getting away from the fact that HS2 construction would have negative economic consequences, but there is no recognition mechanism in HS2 Ltd’s appraisal process.

Disruption in West London, Camden, and Birmingham is monetised at £0 in the HS2 Economic Case, and the costs of reconfiguring transport infrastructure (e.g. re-locating Birmingham Airport, providing tram access to HS2 at Curzon Street, rebuilding Euston LUL concourse), are considered external to the scheme boundary by HS2 Ltd.

HS2 Ltd’s position is not credible. Economic appraisal of its high speed rail scheme should be conducted with a view to capturing the extent of costs, as well as benefits.

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Written by beleben

November 1, 2012 at 12:25 pm

Posted in Great Western, High speed rail, HS2

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