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HS2 and construction inflation, part two

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The June 2008 Railnews report “What future for high speed rail in Britain?” gave Greengauge 21’s estimate of the cost of a 177 km high speed railway from London to Birmingham as £7.1 billion, at 2007 prices.

2008 Greengauge 21 estimate for a London - Birmingham high speed line

2008 Greengauge 21 estimate for a London – Birmingham high speed line

The 2014 David Higgins HS2 Plus report stated that the government’s ~225 km HS2 phase one proposal was costed at £19.4 billion (P50 estimate, at 2011 prices). However, that does not appear to take account of Camden and Birmingham council aspirations for ‘high quality’ station developments, or the possible effects of “alliancing” on project delivery. Alliancing, an anti-competitive-anti-SME approach favoured by Network Rail, could add £1 billion or more to phase one costs.

Railnews, 2008: Birmingham Chamber cast doubt on the value of HS2

Railnews, 2008

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Written by beleben

May 28, 2014 at 10:49 am

Posted in High speed rail, HS1, HS2, Politics

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  1. Reblogged this on Transport-Watch and commented:
    Our Facts Sheet 6 Updated January 2012 provides:

    This facts sheet was first produced in August 2002. The update is the same as the original except
    for minor typographical changes and the addition of the latest cost of for the West Coast Main
    Line Modernisation Programme.
    1. At privatization in 1994 the British Rail forecast for track maintenance beyond 2001 was
    £774 million per year (source, page 11 of the prospectus issued in advance of sale). At
    1999 prices that amounts to £0.888 billion.
    2. In contrast the network management statement for the years 1996/7 and 2000 provide an
    annual average for the 10 years 1995/6 to 2005/6 at 1999 prices of £2 billion per year. The
    2001 network statement provides an average of nearly £3 billion per year at the 2001/02
    price base for the five years 2001/2 to 2005/6. Thereafter the cost is forecast to taper off to
    £2.2 billion in 2010/11.The increase from £0.888 bn to nearly 3 billion, a factor of over 3 is
    typical of the appalling record the rail industry has for estimating its costs. Other
    illustrations follow at 3, 4 and 5 below.
    3. The West Coast Main Line Modernisation Programme was to cost £2.35 billion in 1997,
    £2.95 billion in March 1999, £4.75 billion in October 1999, £5.56 billion in January 2000
    and £5.8 billion at the start of the Public Inquiry in February 2001. (Source is the
    Overview Paper produced in May 2000 and a report to the Rail Regulator by Booz-Allen
    and Hamilton dated June 2000). The price rose to £6.3 billion during the inquiry when
    there were press reports that it would cost £9 billion. By August 2002 the press was
    reporting £13 billion, but that was cut to £10 billion after the Regulator struck out
    enhancements otherwise required for the originally proposed 150 mph speeds. That was
    reduced to £7.3 billion only to rise to £10 billion as reported today, January 2012.
    4. An old cost for the Train Protection System is £1 billion but that rose to £6 billion
    according to the press but the number is now quoted as £3.8 billion.
    5. Meanwhile the overall cost of Railtrack’s original nation-wide Modernisation Programme
    rose from £50 billion through £60 billion to a projected £73 billion – Sufficient to build the
    residential accommodation for a city of 1.5 million people. Where that programme now
    stands is not clear.
    The original cost estimates misled the Government and shareholders into commitments which
    may never have been considered if the actual costs had been available. Possibly these massive
    cost failures are deliberate. In any case they are mirrored by equally massive misrepresentations
    to do with capacity, safety and other issues, see other facts sheets.

    transportwatch

    May 28, 2014 at 2:02 pm


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