Financial News

  • 15 December 2013, 15:08

HS2 Report: High-Speed Rail 'Essential To UK'

High-speed rail is "essential for the UK", according to a report by a committee of MPs.

The risk of not going ahead with the project "significantly outweigh the risks of doing so", the House of Commons Transport Committee has said.

The MPs suggested that the second phase, from Birmingham to the north-east and north-west, should be built at the same time as the first London to Birmingham phase to get trains running ahead of 2033.

However, they warned the £50bn project should not delay other vital transport projects.

Their report also criticised the Department for Transport for "unqualified" claims the project would bring £15bn benefit to the economy.

The cost of the project in its entirety is estimated at £42.6bn with £7.5bn needed for the high-speed trains. Of this £42.6bn, a total of £14.56bn is contingency.

In its report, the committee said: "The Department for Transport's (DfT's) communications about HS2 should emphasise that the estimated cost is £28bn, not £50bn, and that cost increases to date have largely been due to the decision to undertake more tunnelling and other work to mitigate the impact of the project on people living near the route."

The report added: "The project is now commonly regarded as costing £50bn and rising. This has led to exaggerated references to HS2 requiring a 'blank cheque' from Government."

In their report, the MPs said the incoming HS2 Ltd chairman Sir David Higgins should report to ministers by the end of 2014 "on options for speeding up HS2".

The first phase of the scheme, from London to Birmingham, is due for completion in 2026. The second, Y-shaped section from Birmingham to northwest and northeast England is due to be finished in 2032/33.

Campaigners have raised concerns the project will destroy vast swathes of England's countryside. The Woodland Trust has calculated that 21 ancient woodlands will be destroyed or significantly damaged by the first phase.

Joe Rukin, campaign manager for the Stop HS2 group, said that it was clear the latest inquiry "was going to be a cheerleading whitewash when the Transport Committee only called people who support HS2 to give evidence".

Transport Secretary Patrick McLoughlin welcomed the committee's finding that the North-South railway was what he called the "best long-term solution" for increasing capacity.

Shadow transport secretary Mary Creagh said that, although Labour supports HS2, "three years of Government delays and mismanagement has caused costs to balloon".

She added: "Incompetent ministers have only recently launched the consultation on phase 2 of the route, despite the fact that it was being worked on when Labour were in government."