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‘Unthinking populism’ has led ‘some to put forward scrapping HS2 as a solution to worrying projections of economic losses from Brexit’, according to the high speed rail lobbyists Greengauge 21.

[HS2: a magic money tree?, GG21, 27 September, 2018]

‘Here’s £50bn we could save and spend instead on (say) the NHS’.

But scrapping HS2 does not create a magic money tree.

Rather, it would be an act of extreme short-termism, signalling no belief in the future of the UK.

For a start, aborting the capital spend on HS2 means losing the stream of economic benefits it generates at roundly the rate of £2 benefit of every £1 outlay.

The claim that ‘HS2 would create £2 of benefits for every £1 spent’, assumes that the costs and benefits set out in the HS2 economic case from five years ago are correct. That is a very dangerous assumption.

For example, the economic case monetised the benefits of the Davenport Green (Manchester airport) HS2 station, but not the costs of building it (confirmed by FoI response).

And according to the West Midlands Combined Authority, billions of pounds extra must be spent on a ‘connectivity package’ and ‘growth strategy’ to ‘realise the benefits of HS2’. Without this extra spend, how would people, for example, reach the beetroot ‘Birmingham interchange’ high speed station at Middle Bickenhill?

West Midlands HS2 growth strategy, July 2015, before the airport tramway cost increased to £872 million

[GG21]

Just look at the experience with HS1 (the channel tunnel rail link, as was). Just two years after its completion, it was sold on a long-term concession to a major pension fund. At a stroke, HM Treasury recouped around 40% of the line’s capital cost.

What looking at the experience with HS1 shows, is that the public have been saddled with a debt of £4.8 billion (which is set to double).

BBC News, HS1 leaves £4,800 million debt

Although the sale of the HS1 lease raised just under £2.05 bn for the government, that does not mean that the public purse is £2 billion better off overall.

HS1 is UK government underpinned

Cancelling HS2 would free up funds for the NHS, libraries, museums, schools, and better rail infrastructure across the country (for example, S-Bahnen in Leeds and Manchester, Great Western electrification from Newbury to Plymouth, and a new direct cross-country route from Birmingham to Cambridge via Northampton and Bedford).

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Written by beleben

September 27, 2018 at 4:14 pm

Posted in HS2

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