As economic recovery becomes embedded the government is right to promote the widest range of infrastructure projects for the future. Funding has been committed to around 200 shovel ready projects due to get underway this tax year, which are collectively worth £36bn and estimated to support around 150,000 jobs. This level of activity however, remains small fry in view of the 2011 National Infrastructure Plan which set out more than 500 schemes worth £350bn. In truth infrastructure spending has actually fallen by 9.7% over the past two years, according to data from the Office for National Statistics.
Provisions in the Infrastructure Bill (which is expected to be announced in the forthcoming Queen’s Speech) to promote the building of more major roads and fast-track new developments are hugely welcome. However, the massive opportunity cost of pursuing HS2 remains a huge constraint on many viable infrastructure projects. This is why I firmly believe the vast capital and goodwill to be expended upon HS2 would be more wisely made available to the many other shovel ready transport and rail schemes already identified nationwide.
I have long been sceptical that the immense cost of HS2 would be anywhere near matched by its potential benefits. The arguments I made below remain virtually unchanged (aside from the huge increase in overall and contingency costs) from when I first made them in July 2011. In a nutshell, I believe that if HS2 were to be built it would actively constrain overall UK economic growth sucking yet more investment from our regions and feeding it into the Capital. We can, and should, do much better.
Seldom are there many votes, or any outpouring of public support, for MPs who promote large infrastructure projects affecting their locality. This is especially true of disruptive construction work necessitating the demolition of homes, years of wrangling over arrangements for compulsory purchase or its terms and endless traffic disruption.
I know this all too well. The £17 billion Crossrail project has disturbed, blighted and infuriated thousands of my central London electors in recent years and will continue to do so for much of this decade. It is vital London continues to capitalise on the momentum generated by its success and presses ahead with the ambitious plans for the construction of Crossrail 2.
My unequivocal support from the outset for the new cross-Capital transport link has only brought me public approval from business owners, almost all of whom live elsewhere! True, my representations played a tiny part in making small, but significant, changes to the proposed route and ameliorate the disruption to constituents in the Barbican and Bayswater. However, it is also probably the case that the silent majority of local people begrudgingly accept a state-of-the-art transport upgrade as a clear indication of progress, crucial to promoting economic growth in the decades ahead.
The same will only happen with the proposed High Speed Rail link (HS2) if the case for investment here can be unequivocally and forcefully made. If it is serious about getting HS2 built, it is high time that the government starts making a strong public interest argument before Conservative opposition to this now £42.6 billion project becomes overwhelming.
I must confess that the underlying logic of HS2 has always been something of a mystery to me. Surely if HS2 reduces current travel times between London and Manchester by forty-five minutes or so (and remember they are already steadily being reduced by existing train operators), does this not make the Capital an even more attractive destination for those who live in the North, rather than vice-versa? Would it not make more sense to link the UK’s biggest provincial centres (Cardiff, Bristol, Birmingham, Manchester and Glasgow as well as Leeds, Newcastle and Edinburgh) with a new network of high speed lines to promote growth outside the South East?
True, in contrast to the Crossrail spurs running West and East from London, the HS2 proposal does at least offer substantially enhanced and additional capacity. Nevertheless, most of the job creation actively identified for the first stage (not much in any event) is in London rather than the Midlands. Indeed, the genesis of the project was a response to relentless business criticism of the Party’s decision to oppose a third runway at Heathrow. HS2 allowed the Conservatives in Opposition to cloak itself in a visionary, environmentally friendly, long-term transport policy.
If, as its advocates claim, HS2 is to create transformational economic benefits to the regions of England there would be strong evidence that HS1 (the St Pancras to Kent coast line) had boosted the economic prospects along its route over recent years. Such evidence is non-existent. Many businesses in my constituency already outsource jobs to areas with cheaper property costs and the concomitantly cheaper cost of living for staff from Belfast to Glasgow and Bournemouth. This exodus from the capital (very welcome to the UK as a whole) has been driven not by physical transport links but by the internet and efficient broadband speeds. Rather than paying vast subsidies to build old technology (quite possibly employing experienced non-UK companies) in order to create the means to shovel people round the country faster and more expensively, are we sure we are not missing and trick? Should the UK not aspire to being global leaders at developing internet technology that lowers transport subsidies, improves our ability to meet carbon emission reductions and fosters local communities and family life?
After all, rail travel has been the recipient of huge levels of public subsidy for much of the past century and in the months and years ahead, I suspect it will prove difficult to justify the huge, and virtually exclusive, burden to the public purse represented by HS2. Ninety-one percent of passenger miles travelled in the UK take place on the roads with eight percent on our railways (the tiny remainder are air miles). Whilst drivers contribute a net 4p to the Treasury for every mile travelled (predominantly from oil/patrol duties), rail passengers are on average subsidised to the tune of a net 16p by the taxpayer for every mile travelled. Naturally these raw statistics do not tell the whole story as they take no account of the economic importance of commuter travel on our railway system.
Who uses rail? Predominantly it is the relatively well-off (even if many hard-pressed commuters do not necessarily regard themselves as such). As one road lobbyist put it to me recently, rail has all the characteristics of a middle-class luxury subsidised by the masses, a sort of ‘opera on wheels’. Whatever the total economic benefits derived by HS2, only one-third is designed under its financing plan to be captured through the fare-paying public. The business case currently being made proposes that net revenue will amount to some £8bn over the sixty year life of the HS2 project. The rest of the cost will be subsidy plain and simple.
Unless and until the government starts to take its argument to the areas most affected by this new project it should not be surprised that Conservative MPs with constituencies along its route take the easy path of least resistance by supporting vocal, hostile, local opinion. In the febrile political atmosphere that has already seen so much of the coalition government’s radical reform watered down, there is also the lingering suspicion in the minds of many Conservative MPs that had HS2 been designed to cut a swathe through Liberal Democrat (rather than true blue Conservative) heartlands, the plans would have long since been shelved.