HS2 rail project benefits uncertain, says review

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The financial benefits of the HS2 London to Birmingham high-speed rail project are uncertain, an independent review prepared for MPs has found.

The Commons transport committee asked consultants to look into the business case for the government's £32bn scheme, due to be completed by 2026.

Their review said London could benefit "possibly at the expense of less service-orientated cities on the line".

It added there was little evidence on the regional and socio-economic impact.

The report was published as the transport committee held the first of five evidence sessions on HS2.

It looked at the overall business case rather than the details of the route, which passes through several beauty spots as well as a large swathe of suburbs in north-west London.

The first phase of HS2 will link London and Birmingham, with extensions further north later. A Y-shaped section taking branches to Manchester, Leeds and possibly further north could be finished by 2033.

HS2 is a central facet of the coalition government's transport policy and was touted as an alternative to the third runway at Heathrow when the government scrapped that last year.

Key dates for evidence at committee

  • 28 June: HS2 supporters
  • 12 July: HS2 opponents
  • 6 September: Aviation and environmental groups
  • 13 September: Transport Secretary Philip Hammond

Giving evidence, Anthony Smith, chief executive of rail customer watchdog, Passenger Focus, told the committee he hoped HS2 would not be seen as a "rich man's railway".

He said the way the line was presented and ticket pricing was "very important".

West Coast Main Line passengers went through "eight years of pain" while it was upgraded, he said, so a new line had its attractions.

Association of Train Operating Companies chief executive Michael Roberts said he anticipated a gap between the West Coast line being "full by 2024" and HS2 running by 2026.

In written evidence to the committee, the Department for Transport said building the London to Birmingham section would create more than 40,000 jobs.

It added that analysis suggested economic benefits of about £44bn from the proposed Y-shaped network.

Concept image of high-speed train The new line - and high-speed trains - would cut the London to Birmingham journey time to 49 minutes

The report by Oxera consultancy firm said the estimates were surrounded by a "degree of uncertainty".

"The overall balance of non-monetised impacts - which include landscape, carbon and changes in land use - is difficult to ascertain."

It went on to say there was evidence that service and tourism-orientated cities were "most likely to benefit".

"London is thus very likely to benefit, possibly at the expense of less service-oriented cities on the line."

It added that just over a third (34%) of quantified benefits in the economic case were to long-distance passengers from London, so "the regeneration effects (if they exist) would be large in London".

However, it warned that regeneration benefits in one area could be offset by losses in areas not served by the high-speed line.

"The precise impacts will depend on the reallocation of conventional services on the West Coast main line and elsewhere," it said.

A total of 190 organisations have submitted evidence to the committee but Transport Secretary Philip Hammond is not expected to answer questions until 13 September.

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