By Malcolm Evans & John Lewis
The business and economic case for HS2 has been in some quarters taken for granted from day one. This last week saw the announcement that an incredibly expensive fast train track from London to Birmingham will open some time quite a long way into the future. At some date even further away than that, it may or may not be extended to Manchester and Leeds.
This, we have been told repeatedly this week, is cause for major joy in Manchester.
We are far from sure that the business and economic case has been established and for the avoidance of doubt we summarise these concerns here. We welcome a similarly clear exposition of the case in support.
These, then, are the main reasons why we feel HS2 is dubious as a value proposition:
1. What goes up is just as likely to go down – in fact more likely: Prof Alan Townsend – eminent economic geographer and national statistics expert – recently pointed out to a New Economy briefing in Manchester that he and his colleagues believe the likely outcome will be a net drain out of the Midlands and the North into the SE.
2. We don’t want it: a majority of businesspeople feel it is a waste of money and that it will do little to improve their prospects. In our extended networks we have detected very little enthusiasm for HS2. That’s a pretty wide sample of sentiment.
3. It’s not how we do things: the internet is the prime channel of business, not hopping on a train to London. Then there’s the telephone and, if you go there, the existing train and flying and driving if you want.
4. The enthusiastic minority: It seems no coincidence that the people who have come out most loudly in support of HS2 are exactly those people who do like popping up and down to London – politicians, the transport sector lobby and public sectorists being the loudest amongst the clamour of support.
5. Who does it serve?: What are the real benefits (if a marginal time saving in the context of an overall journey is really much of a benefit) beyond the termini of the proposed service? How will it include and link-up beneficially to those people not neatly bunched very close to the main stops?
6. Here’s something for the regions: It smacks to us as being as much politically driven as underpinned with potential cost effectiveness. In lean times the main metropolis will enjoy even greater economic leadership over the hard-pressed regions. HS2 looks like an act of generous rebalancing; we don’t think it stacks up as a justifiable proposition.
7. A questionable solution tomorrow to today’s problems: the completion of HS2 is so far off that it will arrive (on time and budget?) into a quite different world. Ultra-high speed internet and related technologies will have transformed communications and radically reduced further the necessity of face to face meetings.
8. Better use of existing resources: existing rail has the capability of being made substantially more efficient at significantly lower costs. Use of the major road network will become much more efficient, with the likes of bumper-to-bumper “roadtrain” technologies.
9. Priorities and value for money: there are many other investment possibilities which would achieve much more for less within the NW. These range from visionary regional infrastructure projects such as Atlantic Gateway, through to the ongoing enabling conditions of access to capital, skills relevance and superior export support.
10. Who’s winning the business?: what steps are being taken, as far as is possible, to ensure that the money spend is re- circulated to maximum benefit within the UK’s economy? What we must not see is the money going straight out to foreign banks, international private equity firms, overseas plant and rolling stock providers (although we have allowed our indigenous rail industry to become very run down), and overseas constructors/operators.
In summary, we really suspect that HS2 may be fundamentally flawed. What makes us really suspicious is that it is the usual suspects who insist that it is wrong to be suspicious (e.g. non-critical public sector organisations, vested transport interests, media – quite understandably – seeking “good news”).
But we don’t believe in jumping onto bandwagons, as bandwagons usually hit the buffers sooner or later.
Please feel free to persuade us that this is going to be absolutely great. We have been bombarded and petitioned relentlessly by the promoters of HS2, much of this marketing effort funded by the public purse.
We shall take silence to our reasoned list by the HS2 zealots (Manchester doubters were dismissed a few days ago as “lingering negativity”) as strengthening the argument that there has been far too much giddy hopping onto bandwagons and far too little sober reasoning.
If a fairy godmother were to grant the scheme free of charge (or for some figure which seemed remotely value for money), if it were to be delivered in a timely period, if it were to coincide with a period of more robust economic health……there might be a case.
But as it stands, until there is some convincing substance behind the hype, we are standing our ground.
What do you think?
- Funding Enterprise, alongside its corporate finance role, is the leading independent and self-funded economic development commentator in the NW.