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High Speed 1 underwhelming passenger numbers exposed taxpayer to debt risk

Underwhelming passenger numbers on the UK’s first super-fast railway, High Speed 1, have left the taxpayer exposed to a potential debt risk, according to a report by public spending watchdog the National Audit Office.

Published today, the report The completion and sale of High Speed 1 said that while international passengers have grown in number since the line opened, they continue to fall far short of original forecasts, while the project costs exceed the value of journey time saving benefits.

Construction of the line cost £6.16bn — 18% higher than the target costs, it says, adding that the line was delivered 11 months late.

Actual passenger numbers between 2007 and 2011 were, on average, two thirds of the level forecast when the Department for Transport guaranteed the project debt in 1998, to enable the line to be built. “This left the taxpayer exposed to the risk of lower-than-expected passenger income, which had been expected to repay the project debt,” says the report.

Readers' comments (8)

  • Now then, now then, let's have a bit of calm from the HS2 detractors. I mean, the same mistake wouldn't be made again would it? Surely

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  • With the present incompetent lot making the decisions the same is guaranteed to happen with HS2. Never mind the taxpayer can still fund the deficit - at least until the country is officially bankrupt.

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  • John Mather

    And where is all the electricity going to come from?

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  • I am a regular user of HS1 and can attest to the increasing passenger numbers. It is a brilliant service and I am sure if the nose dive economy had not hit when it did i.e. just after the line opened, then a great many more people would be using the service. Was that factored into the reporting I wonder? There are too many doom merchants around at the moment - can we not try and be more positive? As Engineers we should be offering solutions and answers to support innovators not nay saying. We need infrastructure investment and more confidence in moving major projects forward to get our economy going again. Just my view.

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  • Roland - no, we as engineers cannot condone the building of schemes which do not provide a positive social or economic benefit. That would be a nonsense.

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  • There are a lot of political factors that make HS1 loadings lower than predicted, and only the most dilatory interest in freeing up the restraints.

    These all make a journey through the tunnel a major planning exercise rather than just another train journey:

    1. We have passport controls with our European neighbours. There are thousands of Far East tourists happy with one visa that covers 26 countries (and it's cheaper than a a UK one!). If we were in Schengen too, many of those would happily visit the UK by train as part of their European holiday.

    2. We have Chunnel security checks that are out of synch with other European mega-tunnels, such as the base level tunnels through the Alps.

    3. The restrictions in 1 & 2 have delayed the expansion of Eurostar services to the obvious extra destinations, such as Amsterdam and Cologne.

    4. The same restrictions have deterred any serious plans for the cross-channel commuter services that both the local English and French regions want.

    4. The bean-counters decided that a premium fare must be paid for the high speed commuter services to Kent. They assumed that the only way to get their money back was to charge high fares, rather than let the traffic be attracted by the reduced journey times. That has had a knock-on effect on the original Kent services too, as they have deliberately been made slower to push commuters over to the high-speed services. It's not a zero-sum game. Provide good train services at fair prices and the people will travel.

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  • Stuart - I have only used the Chunnel twice once as a rail passenger and once as a car driver. On each occasion the passport checks were no slower than rail ticket checks. With my car, loading the vehicles caused more delay than the passport checks.
    I cannot remember any security checks. I don't know if that was because they were unobtrusive or did not happen.
    Was my experience unusual? It was certainly different to your description. I think the Channel would offer more of a deterrent to foreigners than the means of getting here.
    The experience of committing to HS1 should act as a guide towards the decision making for HS2. I often feel that the comments for and against HS2 are made in justification for unmovable committed decisions.
    Perhaps the answer is to ask a foreign entity to make the decision for us thereby removing the emotion? Alternatively programme a computer to decide. In any case the decision ideally should be made by people/bodies who do not stand to gain whether it proceeds or not. Each side should make their pitch and then let an "independent" decide. Let's then live with the decision and get on with it rather than submit it to continual revaluation.

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  • The recent Government announcements, as reported in NCE, regarding the minimal investment planned for road improvements and maintenance for the period up 2015 as compared firstly, to taxation revenues extracted from motorists and the road haulage industry and, secondly, the planned expenditure on HS2, it is clear that there is an enormous gulf between the cost benefits for each element.
    If one considers the numbers of journeys and people movements involved with each mode of transport and the possible reduction in injuries & fatalities (and the costs associated with each) the disparity becomes stark
    Given the obvious safety gains obtainable from well designed road improvement schemes - with a subsequent reduction in casualties - surely there are other dimensions to the whole argument surrounding the use of public funds for transport infrastructure.
    As Engineers, it must be beneficial for us to argue for an extension of the discussion to include a rational cost benefit analysis across the whole transport infrastructure debate.

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