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Public Accounts Committee – HS2 business model is from ‘Field of Dreams’

HS2 has been torn apart again by the Public Accounts Committee, with Chris Heaton-Harris MP saying “The HS2 business model is from ‘Field of Dreams’ If you build it, they will come!”. Heaton-Harris also pointed out that the DfT has knowingly used out of date models for forecasting passengers because they make the business case work better.

Austin Mitchell MP said the project has been “Plucked out of the air so as to not be humiliated by the French.” The French Government last week slashed their future high speed rail projects.

As with last time HS2 was up in front of the Public Accounts Committee, the majority of criticism came from the Chair, Margaret Hodge MP. She initially said the defence of the £10bn price from HS2 Ltd, that until last week they didn’t have a budget, but just a cost estimate was “Absurd”, saying she “Wished you guys were honest” and that it is “Absolute madness to think you can get the Hybrid Bill through in stated timetable.”

Further criticism from the MP for Barking included: “When we last discussed HS2 we said the way you have assessed business passenger values is out of date. You have gone away and done nothing. If you reflect more honestly the value of time saved for business passengers, your benefit cost would be negative. HS2 gets a positive cost benefit ratio because of the weight you give to business travellers. It gives you the answer you want. If you take £50bn and you distort the figures this way you end up with an argument to build your project.”

Most worryingly, Richard Bacon MP pointed out that: “You’ve given process of forecasting passenger numbers to people with vested interests in HS2 going ahead.”; adding “If your methodology was that good, you wouldn’t have got an £8bn hole. Taxpayers are distrustful of your ability to get this right.”; and “Everyone thinks it’s going to be £70bn, £80bn or £100bn by the time it’s finished. That’s par for the course, judging by your record.”

HS2 Ltd officials floundered throughout the hearing, admitting that they had got the costs for land purchase of Phase 1 wrong, but dismissing most of the concerns of the Committee and trying to blame the consultants they have employed for any problems. David Prout claimed Coventry City Council now supports HS2, which it does not.

Stop HS2 Campaign Manager Joe Rukin said:

“The Public Accounts Committee have torn HS2 apart yet again. Like the National Audit Office and Major Projects Authority, this body is set up specifically to stop taxpayers money being wasted and have severe concerns that the whole case for HS2 has been made up. They don’t have little quibbles or minor doubts, they have trashed the fundamentals which have been made up to support this project. They must be listened to, and this project must be stopped, it’s a train crash waiting to happen.”

“It’s great that there is a group of MPs who haven’t swallowed the pro-HS2 spin in the Westminster Village. There are serious concerns, and it’s clear that with the majority of MPs supporting HS2, they don’t care that there are serious problems with a case that has been fabricated by firms who will make money out of building it, or that their support for HS2 shows they are out of touch with reality and the general public. While the case for HS2 might come from ‘Field of Dreams’ the whole thing is a complete nightmare.”

Penny Gaines, Chair of Stop HS2 said
“It was very clear that HS2 Ltd and the Department for Transport were completely unable to answer the many serious questions about the case for HS2 that the Public Accounts Committee put to them.  These range from the overall cost estimates for HS2 to specifics about the business case.

“Every time HS2 owned up to any kind of mistake, they acted like naughty school kids desperate to pin the blame on consultants, without seeming to realise that they are responsible for the management of the project to date. It is hard to imagine them being able to buy a train ticket let alone attempt to build a railway line. It’s time to put the HS2 management team out of their misery and cancel the HS2 project as soon as possible.”

“The more people look closely at HS2, the more they realise the flaws in the proposal.  Both the Public Accounts Committee and the National Audit Office are questioning the sums produced by HS2 Ltd and the rationale for building it by the Department for Transport.  With the headline cost of HS2 now at £50 billion, it should have the soundest case possible for building it.  France has just thrown the brakes on their high speed rail programme.  The government should stop this runaway train before it costs the country any more money.”

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5 comments to “Public Accounts Committee – HS2 business model is from ‘Field of Dreams’”
  1. The expert on the govenments new hs2 train set for the millionaires to use mr Simon burns as said in the papers that he plans to shift our woodlands to a new location is he mad is this the same man who says the cost will not go past 43billion and the man who says all the people along the line will have to move useing there own money for the sake of the millionaires saving 15mins off there journey time to Birmingham from London this man should be the excuse for our pm to cancel hs2 and save the country billions of unknown debt which hs2will cost

  2. At the recent PAC session the following exchange took place–

    Q75 Chris Heaton-Harris: I haven’t been able to find the information properly, but most high-speed railways across the world need subsidising post construction. What sort of subsidy level is the Department thinking of giving when things are running after construction?

    David Prout: All our modelling shows that there will be quite a substantial operating surplus for HS2.

    Q76 Chris Heaton-Harris: Okay, so it is going to be one of the very few high-speed rail projects in the world that runs at profit in surplus.

    David Prout: Yes. Built into our BCR is the operating surplus.

    I have asked the dft for clarification—perhaps others could comment please?

    • modelling = wildly flawed and repeatedly disproven guesswork. The dft and pte’s have an interest in this happening. People are looking at their banks and careers rather than the merits. The country will pick up the tab

  3. In reading this I think one begins to discern the truth about how ‘dissent’ will be managed.
    It is disgusting that democracy has been reduced to this level of cynical ‘top down’ abuse/political management.

    https://www.gov.uk/government/publications/hs2-modelling-and-appraisal-a-statement-to-the-public-accounts-committee

    What is interesting is that a public park in Istanbul realized a passionate and Internationally noted response. This is 900 sq miles of blight through the country.
    In the UK we can sacrifice Gov. protected AONB to a scheme with no proven basis and at huge cost in a time that many of the population have been saddled with cuts (and the Govt. award themselves through an an indepepent (albeit dependent agency) a huge cash pay rise whilst the general population have lost 10%+ over three years) and the population are complacent………..or are they…………..HS2 ltd and the Govt represent the popular stance to HS2 as being ‘in agreement,………in reality it is only the House who are not reflecting public opinion.

    It is a time that our Parliament were shamed by their hypocrisy and lack of professionalism (they vote in favour of financially improper projects that have no socio-political basis and agree policies that harm the weakest members of the society on the basis of ‘austerity’.
    Shame on you!

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