Former Labour Rail Minister and Glasgow MP, Tom Harris has said that he is “Becoming ever more convinced that from the Labour point of view there is nothing to be gained from supporting HS2.” Harris was speaking at a Parliamentary event at which Quentin Maxwell-Jackson, a former senior partner at KPMG and author of a soon to be published report from Centre Forum on UK infrastructure, said: “The opportunity costs for HS2 are too high and we simply cannot afford it.”
Harris, who chaired a Parliamentary briefing held by the Institute of Economic Affairs, told MPs that he was neither for or against the concept of HS2 as there are arguments both for and against the project, and that whilst Ed Balls is sceptical about the project, it was wrong for commentators to see the appointment of Mary Creagh as Shadow Secretary of State for Transport as Labour going cold on the project, as he confirmed the Wakefield MP is a ‘strong supporter’ of HS2, and that he expected Labour to continue to support HS2.
However, Harris told his fellow MPs:
“The question Parliament now has to answer is whether the case for HS2 is strong enough. When I was rail minister, I spent most of my time dealing with the Eddington report, which was not encouraging to the high speed rail lobby. It was seen then that it no case for it could be made for it in terms of environmental arguments or interconnectivity. Since then we have had a Parliamentary shift to full throated support.”
“Everyone wants to be the Minister who says ‘yes’, no one wants to be the bad guy who stands up and says this isn’t worth the money. The political challenges that HS2 is facing are that there are environmental consequences, but we must also look at the construction costs. In the current control period, the moment Government is committing £10bn over a five year period on other rail projects, including lengthening trains and replacing carriages. You cannot convince me that when HS2 is built and you are talking about spending £50bn over a nine year period, that a secretary of state will be able to continue to fund those needs for the rest of the network.”
“And HS2 is a political issue, because Government will be asking people who will face cramped conditions on other parts of the network to continue to stand, and to continue to pay increasing fares, and to have to pay for HS2 as well, which they will most likely never use, through their taxes.”
“I am becoming ever more convinced that from Labour point of view there is nothing to be gained from supporting HS2. The worst thing we can do as politicians is to ask for a blank cheque on the promise that at the end we will have turned this country into a new European utopia. If at the end of this we will have spent £70bn or whatever and not delivered on promises, then politics itself will have been devalued.”
Dr Richard Wellings, who authored a recent report into HS2 on behalf of the IEA said that there were many other projects with far better cost benefit ratios which will be ignored because of HS2. He said
“The benefit cost ratio for HS2 is really about zero point five (0.5) when you use realistic assumptions. HS2 has always been more about politics than economics.”
He identified three ways in which the costs for HS2 will go up: Buying off opposition, additional regeneration costs not only to the cities getting HS2, but to others which disbenefit from HS2 such as Coventry, and spending money to solve the problems HS2 creates in connecting HS2 to the rest of the network such as how to disperse passengers at Euston. He was also clear that HS2 was being driven by a strong lobby from construction firms which would net billions of pounds worth of contracts, and city councils which would have stations.
To finish off, Quentin Maxwell-Jackson, who has been working on a report from a Liberal-Democrat think tank on infrastructure which is soon to be published, said:
“The problem is that if you spend £50bn on HS2, then you don’t have that money to spend on other things. In 2010, this Government announced a national infrastructure plan which would spend £40bn per year for each of the five years of office, but they have missed it by £7-8bn each year and this is going to get worse.”
“Atkins reported that it would cost just £2.6bn for West Coast Mainline improvements which could see an extra five trains an hour, bringing the Inter-City services on the West Coast Mainline up to what is proposed with HS2, without the Heathrow link*. So you could do that and still have over £45bn left to do other things. The opportunity costs for HS2 are too high and we simply cannot afford it.”
*[This would actually mean more inter-city trains to WCML destinations than under HS2, as some proposed HS2 services currently operate on the East Coast Mainline]
Following the meeting, Stop HS2 Campaign Manager Joe Rukin said:
“It’s not just Labour who will gain nothing from supporting HS2, all the parties who continue to support it lose. Tom Harris says politics itself will be damaged by HS2 if it fails to live up to the grandiose promises, but it is being damaged right now. The real world shows that the cost of living is rising, services are being cut and unemployment is only falling due to the rise of zero hours contracts. Against that backdrop, politicians are saying ‘Don’t worry it’ll be alright in 20 years, because we’re going to spend a vast amount of money on making it quicker and more expensive for you to commute to London.’ People need jobs in their local areas now, not the promise that there will be a ‘bigger labour market’ in a couple of decades time. If having short journey times and frequent services to London was so influential on economic activity, then Doncaster would be one of the most prosperous places in the country.”