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High speed delay

January 2012

Peter Plisner

After months of debate and consultation, many were hoping the government would stick to its pledge, and make a decision on its plans for high speed rail before the end of 2011. But the announcement has been shunted forward into the new year. Peter Plisner reviews discussions that have been taking place on the controversial scheme during the last 12 months

We’re having to wait even longer than anticipated for the results of a major public consultation on high speed rail. No-one was really that surprised when the change of date was announced. The last couple of months has seen the publication of a critical report from the Commons Transport Committee, and there’s also been the small matter of a change of transport secretary.
Phillip Hammond, a strong supporter of HS2, was promoted and in came Justine Greening. Giving no inkling of a delay in the announcement, on 21 November she met MPs and told them that her key priority in the days and weeks ahead would be to decide on the right way forward, and she said that it was something she intended to do ‘by the end of the year’. But just two weeks later, any hopes of an announcement before the end of 2011 were dashed. Newspaper reports quoted concerns about part of the route near Amersham, and the need for a feasibility study into a possible tunnel option.
The change of heart on the timing of the announcement came after a year that has seen much debate, and arguments about what has turned into an extremely controversial scheme. Opposition groups, who were quick to get themselves mobilised after the original announcement back in March 2010, sharpened up their arguments against the plans.
Other groups, including the Tax Payers’ Alliance, also joined the calls for the scheme to be scrapped. One report, published in February 2010, claimed that there were serious fl aws in the business case for high speed rail. Research commissioned by the group maintained that proposals for the fi rst leg of the line, to the West Midlands, would never produce a fi nancial return and that the benefi ts of the scheme claimed by the government relied on ‘unrealistic forecasts’.
Interestingly, some of those forecasts were amended in February when the government launched a major public consultation on the plans. Later in the year the group, in a joint statement with other bodies, including the Green Party and the Countryside Alliance, stated that HS2 was a monumental waste of money and not in the national interest. It said: ‘Politicians are ploughing ahead with a white elephant that will, even when it is fi nally completed, only benefi t a fortunate minority of passengers.’
Another report, again for the Taxpayers’ Alliance, raised concerns that some train passengers face ‘slower and less frequent services’ if high speed plans went ahead. It said destinations like Coventry, Stoke-on-Trent, Manchester, Leicester, Nottingham, Derby and Sheffi eld would be ‘negatively hit by worse journey times, fewer seats and/or fewer trains per day’.
But there were plenty of supporters publishing their views too. Back in February, an open letter was published in the Financial Times signed by several leading business fi gures, including Andy Street, managing director of John Lewis and Colin Matthews, chief executive of BAA Airports, who declared their support for the plans.
The letter maintained that they believed that the government was right to develop a new high speed rail line. It stated: ‘A high speed rail link will give the economy a much needed boost, particularly in the north and Midlands.’
The letter also claimed that a high speed rail link would create much needed capacity and reduce journey times. It would also, the letter said, ‘improve connections between airports, help current commuter services, and free up space on existing lines to carry more freight’.

February also saw the launch of a major campaign supporting the scheme. Yes to High Speed Rail billed itself as a campaign, independent from the government and HS2 Ltd, representing employers from across the country. The group’s mission statement said those involved believe that ‘Britain needs a modern, high speed rail network to meet the challenges of the 21st Century’. The director of the new campaign was David Begg, the former chairman of the Commission for Integrated Transport.
With position statements published by a variety of groups, the scene was set for the start of the public consultation. It was launched at Birmingham’s International Convention Centre on 27 February. Bizarrely, despite marking the start of the consultation, those against HS2 were not initially invited. A document published by the DfT stated: ‘We believe a national high speed rail network from London to Birmingham, and onward to Leeds and Manchester, can transform the way Britain works and competes as profoundly as the coming of the original railways in the 19th century.’ It added: ‘Our competitors already recognise the huge benefits high speed rail can bring, and are pressing ahead with ambitious plans. Britain cannot afford to be left behind.’
Throughout the year there were plenty of other reports produced by a variety of other groups, both for and against the controversial scheme.
In July the Institute of Economic Affairs suggested that the case for HS2 was ‘economically flawed’ and based on ‘bogus calculations’. The free market thinktank published a scathing assessment of the plans, saying that the project was a ‘recipe for disaster’. Its report also suggested that the scheme’s environmental credentials were ‘questionable’, and that the projected passenger figures were ‘suspect’. But there were also several reports backing the plans, including those from high speed lobbying group Greengauge 21.
The group published research from accountants PricewaterhouseCooper, setting out what it claimed was the first analysis of what the government could expect to see as a financial return if it sells the infrastructure of HS2, in the same way as a 30-year concession was recently sold for HS1. PwC’s figures showed that it could produce between £6bn and £7bn as a return on the £13.9bn investment. The report also stated: ‘There are potentially further cash returns over the lifetime of the project.
The Exchequer will receive, over time, estimated extra tax receipts on the profits earned by the infrastructure concession holder and rail operating franchises worth £1.5-2bn and, at the end of the initial concession period, HS2 could be sold again, generating a further £1-2bn return to the taxpayer.’
The public consultation ended in July and things went rather quiet on high speed rail. But it wasn’t long before the debate had started again. South Northamptonshire MP Andrea Leadsom successfully lobbied for a Commons debate on the subject.
Opening the debate, she was highly critical of ministers who, she said, had likened HS2 to the great Victorian railways and the ‘fabulous’ post Second World War motorways. Leadsom said: ‘I am sorry, but I just do not buy that argument. The Victorian railways were largely privately funded. The motorways are fabulous, but they have benefited every town and village in this country, because they have junctions every few miles.’
Soon after the debate, there was another bombshell from parliament, this time in the form of a report from the Commons Transport Committee.
Although its press release suggested that there was a ‘good case’ for high speed rail, the committee’s approval came with a number of caveats and recommendations, including having another look at whether the line should link to Heathrow airport, and a request that government commits to the so called ‘Y network’ before seeking parliamentary approval for HS2.
MPs also told the government to stop calling those against high speed rail ‘Nimbys’.

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