The Department for Transport responded to HS2 Action Alliance’s 13 February letter about legal action by quoting figures to suggest HS2 delivers £4 of benefit for every additional £1 spent.
This is misleading.
The DfT’s January 2012 business case makes absolutely clear that HS2 delivers just £1.40 benefit for every £1 subsidy for London to West Midlands phase, and £1.6 to £1.9 for the full Y.
According to Bruce Weston, from HS2AA, “This is of course before using the latest economic and rail demand forecast tools – which DfT say wipes £0.5 off these figures ie the £1.4 drops to just 90 pence benefit for every £1 spent. These are not our figures, they are DfT’s.
“Even this is based on DfT still assuming that every minute of time spent on board is wasted – which they now admit is not true. Adjust for that, which accounts for more than 50% of the scheme’s benefits, and any shred of a business case has evaporated”
“DfT are choosing to ignore the alternative of uprating WCML that is three times better value for money, again according to their own numbers. It produces £5.17 benefit for every £1 subsidy and more than meets the DfT long distance rail demand forecast. Even Network Rail did not contest this” he added.
At a time when UK are facing further pressure on Government spending HS2 is the wrong priority and makes no economic sense.
It’s really good to hear through this site that HS2AA have now fully committed to proceeding with their full Judicial Review.
Page 59 of the updated economic case for HS2 says that a new classic speed line, which would cost less and be less destructive environmentally, would only produce a BCR of 1.1. This is because increased journey times would reduce the benefits, and would also reduce demand as fewer new passengers would switch to HS2.
In other words, in spite of all the talk about needing more capacity, there is no economic justification for building a new railway line. Only by reducing journey times and increasing demand, and with some financial jiggery pokery, can a dubious economic case be made.