High speed fail: Assessing the case for HS2

Today we release our new report on High Speed 2, High speed fail: Assessing the case for High Speed 2. The report examines the case for the HS2 project and finds that in almost every case the evidence is highly doubtful about whether it would be worth the money. Put together, the doubts and unanswered questions around HS2's viability mean that the case really isn't persuasive enough for the government to go ahead with it.

The first leg of the project, between London and Birmingham, will cost at least £17bn – and up to £50bn if the whole project between London and Scotland goes ahead. We think that this is a low-ball estimate, given the very high inflation rate we are experiencing and public pressure for more tunnels to avoid despoiling natural landscapes. 

Previous experiences with high speed rail in the UK should make even the most enthusiastic supporter of HS2 think twice. High Speed 1, which links London St Pancras station with the Channel tunnel, cost £5.7bn but only sold for £2.1bn. Projections by the promoters of HS1 overestimated the number of passengers by three times the actual figure. Passenger predictions are notoriously difficult – they cannot take account of what measures competitors will take. If the reality for HS2 was anything like these figures, it would create a fiscal catastrophe for the government.

Internationally, there are only two high speed rail lines in the world that do not rely on taxpayer subsidies to remain operational. (They are Paris-Lyon and Tokyo-Osaka, for the trainspotters out there!) The company that operates TGV in France is €25bn in debt. China, long used by advocates of HS2 as an example of a country doing high speed rail properly, has had a disastrous experience with train crashes

The supposed environmental benefits are extremely weak too, mostly resting on the idea that fewer people will choose to fly to Scotland once a high speed rail link is operational. Even if this were true – and, again, it is undermined by previous experiences with high speed rail passenger estimates – it would not take effect for at least thirty years. Nobody in 1980 could predict travel patterns in 2011; why does anybody today think they know what the world will be like in 2041? In the meantime, the 30 minute travel reduction between London and Birmingham is unlikely to change much.

In short, the case for HS2 is remarkably weak. The government should scrap it and save taxpayers from having to cough up for it.

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