In an interview with The Independent, Transport Secretary Patrick McLoughlin has said he wants to ‘fast track’ HS2, saying he would ‘love to’ complete the project in five years, despite construction not even being due to start until then. Speaking of the criticism of the project he said; “All we get is grief. All we get is hassle. But one of the things that government has got to try and do is to look to the long-term future. Whichever route we’re going to put it on we’re going to upset people.”
The Independent also stated that; Mr McLoughlin said critics of the project – who argue that the shorter journey times on HS2 were not significant enough to justify the cost and destruction to the countryside – were missing the point, “There has been a huge change in the way we look at transport since the Birmingham-to-London line was built almost 200 years ago.”
Additionally he told an event at the Conservative conference that he would not review the case for HS2 in light of the franchise fiasco.
Joe Rukin, campaign coordinator for Stop HS2 said;
“It is hard to know where to start with this one. Mr McLoughlin is trying the same old trick, trying to pass us off as just a bunch nimbies and says we are missing the point, but it is he who is missing the point. His Government keeps getting grief and hassle because they are pig-headed about a project which is massively expensive, environmentally disastrous, not what the country needs and will not deliver on its promises. The New Economics Foundation, The Institute of Economic Affairs, The Adam Smith Institute and The Taxpayers Alliance all oppose HS2, and even the Institute of Engineering and Technology have said the plans are fundamentally flawed, but he wants to stick his fingers in his ears and pretend the opposition is all about the route.”
“When the Chair of the Public Accounts Committee is using words like; ‘Bonkers’, ‘Potty’, Crazy’, ‘Shocking’ and ‘Gobsmacked’ about the economic modelling for HS2, how can the Government not listen? The National Audit Office has taken the unprecedented step of investigating this project at such an early stage, and even the Governments own Major Project Authority are unsure about the viability of HS2, but he doesn’t want to accept that is why they are getting grief and hassle.”
“McLoughlin trying to sweep the errors in the WCML franchise under the carpet and saying there are no implications for HS2 is simply irresponsible. There is one thing I will agree with him on though, and I do hope he gets the point; yes things have changed in the last 200 years and we do not need a 19th Century solution to 21st Century needs. He claimed the Ed Balls came out in support of HS2 last week, but what I heard him say is that there was a need for a national infrastructure strategy. That we all agree with, we need a strategy, not an unintegrated standalone project which only benefits the richest. McLoughlin said HS2 would be something for future generations, and he is right, it would be something for future generations to count the cost of and subsidise at the expense of what the country really needs.”
i think it may be hs2 critics may be the ones not dealing with the reality that hs2 will in all likelyhood proceed. as far as crossrail is concerned the overall cost is still £16 billion or about the same as phase 1 of hs2. we can talk about the mix of funding as we know what it is but as yet we cant say the same for hs2 as we dont know the figures yet.
if we look at hs1 some of the cost of building the line was provided via lease to the private sector which is lekley to also occur with hs2. there will also be a large contribution via fares and that is before considering the huge wider economic benefits that will accrue. this is why crossrail and thameslink etc are considered to be so important by boris amongst others. this is why we build transport infrastructure. along with electrification this is one of the few things this government is doing that i agree with. How many people in the chilterns and on this blog voted tory by the way ? or liberal which is effectvely the same thing. mind you hs2 is a policy all parties acutally agreed upon.
i am in total agreement that anybody who is affected by hs2 or has to move needs to be more than adequately compensated. once hs2 is given the go ahead it would actually be better to build it as quickly as possible to minimise disruption
No mention of ongoing subsidies from hard pressed taxpayers then
In their press release, The Rt Hon Margaret Hodge MP, Chair of the Committee of Public Accounts, said:
“Whilst HS1 provides an efficient service, contributing in an important way to British transport infrastructure, there were costly mistakes in the history of the project. These must not be repeated with HS2. HS1 was supposed to pay for itself but instead the taxpayer has had to pay out £4.8 billion so far to cover the debt on the project.”
“The root of the problem is the inaccurate and wildly optimistic forecasts for passenger numbers both when the line was being planned and when the Department restructured its deal with the contractor, London & Continental Railways Limited. International passenger numbers have only been a third of LCR’s original forecast and two thirds of the Department’s forecast. The Department failed to take into account the growth of low cost airlines or the competitive response of the ferry companies.”
“This isn’t the first time that over-optimistic planning and insufficiently robust testing of planning assumptions has got the Department into trouble. My Committee’s report on the East Coast Mainline raised similar concerns. HS1 will continue to cost the taxpayer money–£10.2 billion over the next 60 years, so before going ahead with HS2 we need a robust cost benefit analysis.”
“Some of the Department’s assumptions about the benefits of faster travel are simply untenable. For example, the time business travellers save by using high speed rail is valued at £54 per hour yet the time commuters save getting to and from work is only valued at £7 per hour. It is difficult to see how this can be justified. The Department also assumes that all time spent on a train is unproductive. And unrealistic assumptions about ticket prices act to exaggerate passenger demand forecasts. The Department also told us that it had not considered the benefits and costs of alternatives to HS2 such as investment in broadband videoconferencing or investment in alternative, more local train routes.”
“It is nonsense that the Department does not have a full understanding of the wider economic impact and regeneration benefits of transport infrastructure, including HS1, to inform future investment decisions. All these things are crucial for proving the case for investment in long distance travel and demonstrating value for money. The Department must revisit its assumptions on HS2 and develop a full understanding of the benefits and costs of high speed travel compared to the alternatives.”
If Mr McLoughlin wants to avoid grief and hassle he should ensure that his Department does things properly
His predecessors have treated people with contempt and blighted many lives so I will judge him by his actions and his words
Camerons speach says we are in difficault times, and must not borrow as Labour advocates so where is £32 billion coming from for Hs2?
At the risk of posting informed comment, I’ll try to answer your question @Elaine
There is a strategic infrastructure funding pot of approx £2bn per annum – this sum is already factored into long term govt. spending plans for years ahead. Whether or not the money is borrowed, you’ll have to knock on the door of No.11 Downing Street and ask Mr.Osborne for a peep at the books?
Currently that £2bn pot of money is funding CrossRail construction – scheduled to complete in 2016, when HS2 construction will begin – can I now leave it up to you to conclude where the money is coming from?
Govt funding of crossrail is approx 0.5 bn pa-also I have it in writing from dft that funding stream for hs2 is not yet determined
What can I say @John
The publicised budget cost for CrossRail is approximately £16bn – I understand the construction timetable is approx 8 years – it’s been going awhile already?
16 divided by 8 – I’ll leave the rest up to you?
Re: HS2 – you may have something vague in writing from DfT but that sounds a bit like a Civil Servant hedging his/her bets
The key elements of the funding package for crossrail are as follows:
The Mayor of London, through Transport for London (TfL) and the Greater London Authority (GLA), will contribute £7.1bn. This includes a direct contribution from Transport for London of £1.9bn and contributions raised through the Crossrail Business Rate Supplement (BRS), section 106 and the Community Infrastructure Levy (CIL).
Crossrail farepayers will contribute towards the debt raised during construction by TfL.
Government will contribute by means of a grant from the Department for Transport of £4.7 billion during Crossrail’s construction.
London businesses will contribute £4.1bn through a variety of mechanisms, including the BRS.
Over 60% of Crossrail’s funding will come from Londoners and London businesses.
I leave the maths to you
(let’s hope Penny sees fit to publish this response, in the interests of open debate)
Many thanks for your maths lesson @John
Now for the lecture in political realities – I apologise in advance for the length of this piece, due the necessary complexity of the issues covered
Firstly my original general statement to @Elaine related to funding of HS2, although of course I’ve also made reference to CrossRail with regard to the central pot of strategic infrastructure funding. We’ll focus on the CrossRail project – it seems to exercise your interest
According to your reportage of the outline contributions, the total budget for CrossRail is £15.9bn – construction actually began in May 2009 and will probably complete sometime during the Autumn of 2016 so a period of approx 7.4 years – this gives us an approx annual construction cost of £2.15bn per annum – not so far away from the original £2bn figure stated?
My claim refers to the construction funding, ie. who is putting the money in up front to facilitate construction. Your breakdown of contributions relates to who will end up paying the bills when they are sent out – of course these payments will be phased over a considerable period of time.
The principal reason why you can supply the detailed breakdown (who is paying how much, eventually) illustrated, is due entirely to the devolved nature of Greater London and the transparency this affords. Greater London enjoys certain policy competencies and transport is one of them – this means financial information about transport matters is visible. This visibility does not apply in the same fashion across the rest of England and it would not apply to HS2 either way because HS2 is a National rail project, not a specifically London focused scheme. In short, CrossRail is a project almost exclusively benefitting Greater London so it’s no surprise to find that Greater London is contributing significantly to its overall cost. That’s as it should be.
Now, let’s return to the specific matter of CrossRail construction funding. The company set up to deliver CrossRail is called Cross London Rail Links Limited
This is a 50/50 joint venture operation set up by Department for Transport and Transport for London
We know how the DfT receives its money so let’s examine Transport for London. Take a look at this URL
which provides an insight into the funding streams supporting Transport for London. Firstly the tone of the document informs readers about who’s in really dictating matters at Transport for London and it’s certainly not the Greater London Authority!
According to the details shown in this Spending Review Analysis, yes TfL receives revenues from the farebox, that’s only right, but they also receive considerable funding through grants and guess where they come from. In fact there is specific reference made to TfL’s financial obligations with regard to CrossRail and there are considerable annual sums detailed, nearly £1bn per annum, described as Investment Grants. Now I wonder what that money is for and where it comes from – does the DfT’s £2bn per annum Strategic Investment pot of money ring any bells?
So the black and white picture you so triumphantly paint is not so clear cut after all.
Now of course you are entitled to claim that Greater London fare paying passengers and businesses are ultimately paying a considerable chunk towards the cost of CrossRail – I’m not arguing with that principle – at this point you will claim that the same principle should apply to HS2 – to which my retort is; IT DOES APPLY
Fare paying passengers on HS2 will, ultimately, contribute to the overall long term cost of HS2
Train Operating Companies, running services on HS2, will, ultimately, contribute to the overall long term cost of HS2
Commercial companies operating businesses in and around the HS2 station complexes will, ultimately, contribute to the long term cost of HS2
The notion that the UK taxpayer is going to fork out £32 to £33bn (if that ends up as the total budget cost) and not one single penny is going to come back into the central coffers is simply a convenient misleading half truth, peddled by anti-HS2 campaigners to stir up public ill-will towards the project, for obvious reasons?
I’m not going to try to match the length of your contribution Padav , and won’t get involved in a pi**ing contest today but I will make a couple of points.
It isn’t £ 32 bn to £ 33 bn to build HS2 the official estimate is £ 36.4 bn at 2011 prices. That’s about THIRTY SEVEN AND A HALF BILLION POUNDS at current prices. You know that.
It’s perfectly reasonably to assume that, other things being equal, faster journey times will get more people onto the railways ( that’s what happened with the WCML upgrade and one of the reasons why passenger numbers rose in the last decade ) and that will generate incremental revenue. However whatever way you look at this the figures suggest this covers only a minority of the cost. There is a major funding shortfall .
Existing rail travellers are already paying their rail fares so aren’t contributing to the incremental scheme unless the fares for the “premium” high speed service rise even more than the inflation plus rises that can be expected on the existing network. StopHS2 have always said this is likely and evidence from Europe would point this way. That’s where the rich mans train comes into play. Then we get into talking about elasticity of demand, but the main point is that is not the way the the DfT / HS2 Ltd calculations have been modelled.
The other way that cash could be clawed back is by squeezing services on the “convential” network, either by cutting them or not increasing them in the way they might otherwise have been. A classic case is Coventry. The city council has been told that Coventry has a better London service than it should have. It doesn’t seem to be argued too much now that post HS2 Coventry would have at best 2 trains an hour to London rather than 3 and the journey time would be longer.
You might say that your comment was not so informed after all.
Over 60% of Crossrail’s funding is coming from Londoners and London businesses. Government’s contribution is £4.7 bn.
4.7 divided by 8 – I’ll leave the rest up to you.
Just a thought. Business ratepayers in London are funding a large part of the cost of Crossrail. Business leaders in Birmingham and Manchester seem to think that HS2 will give them an edge. HS2 costs an absolute fortune.
Solution, let’s have those same businesses in Birmingham and Manchester chip in for a large part of the cost of HS2 reducing the burden on the rest of us. Think they would be OK with that ? If yes, let’s do it. If no, makes you wonder if the benefits are all they are cracked up to be.
That’s certainly what the letter I have from the dft implies
Don’t worry Elaine! George Osborne has it sorted. He was in China earlier in the year and suggested to the Chinese govt that their vast sovereign wealth could be put to good use in building our infrastructure instead of getting low returns on foreign govt bonds. China could easily fund the whole project, track, trains and all at no up-front cost to UK govt. Taking the long view, payback would come from the returns of owning and running a little slice of England.
I’ve emailed Mr McLoughlin to ask him what fast track means
Saw the fast track headline last night and thought that at long last he would be publishing the compensation and safeguarding consultations,releasing full details of the Y route,issuing a revised and audited business case which accurately reflects benefits and costs,calling for release of the MPA amber red report,re running a valid consultation etc.etc
What I saw this morning was a combative article basically saying we are getting in the way of the bright future for the UK and that the Dft was totally competent to deliver this paradise
I am temporarily speechless!!!
John: So you were actually expecting something sensible and logical to come from the DfT?
Maybe McLoughlin’s plan is to quell the opposition by making them speechless. He certainly succeeded there.
Wonder if the HS2 supporters may be getting the wobbles about his appointment. After all you would want somebody who you felt had a grasp of what it’s all about leading you. Have they gone stark raving bonkers at Tory HQ?