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MPs throw weight behind full £32bn plan for High Speed 2

MPs this week dismissed concerns over the reliability of High Speed 2 (HS2) passenger forecasting but warned the scheme must be delivered in full if it is to deliver full economic benefits.

The House of Commons Transport Select Committee has backed the full £32bn scheme after an inquiry that lasted several months.

Committee chairman Louise Ellman rejected key criticisms of the scheme, despite concerns from witnesses over factors such as the reliability of passenger forecasting and fare structures and whether they would affect demand for the high speed line.

Passenger forecasts on Britain’s only existing high speed line, High Speed 1 (HS1), were wildly inaccurate, largely because they failed to anticipate the impact of low cost airlines (NCE 3 March).

While the report acknowledges that the original estimates for HS1 were much higher than actual demand, it said that scheme promoter HS2 Ltd has used a more appropriate model.

The benefit cost ratio for the HS2 scheme, excluding wider economic benefits, currently stands at 1.6:1 for the first stretch from London to the West Midlands. This was revised down in February this year from 2.4:1. The benefit to cost ratio of the full Y network including Manchester and Leeds now stands at 2.2:1.

The Department for Transport (DfT) said the downward revision was in part because rail demand was forecast to grow more slowly than had been predicted the previous year.

“Judgements are always involved,” Ellman told NCE. “Extra capacity is needed and can’t be achieved any other way. And we have been reassured that forecasting methods have changed.

Key criticisms of the controversial scheme rejected after House of Commons inquiry. “We are clear that the case for HS2 depends on completion of the Y network — London, Birmingham, Manchester and Leeds,” said the report. “In the longer term, we believe it should be expanded to include Scotland, Wales and other parts of the UK.

Ellman also dismissed suggestions that fare structures could undermine the economic case for the scheme.

Committee member John Leech asked in September whether fare structures had been fully scrutinised and argued that this was a vital factor in determining future
use (NCE 22 September).

HS2 Ltd’s work made a presumption that fare structures for the new line would be the same as existing ones but the committee heard that no further work would be done on this before transport secretary Justine Greening makes her decision on whether to proceed with the scheme, expected by the end of the year.

The McNulty review of rail value for money published in May this year also called for better management of meeting peak demand with reduced fare structures.

The report said it would have been “helpful” if the DfT had provided a “more comprehensive account of the options and implications” of fare structuring. But Ellman said the committee was “not talking about changing existing fare structures”.

Ellman said there were issues that the government must address as a priority. The report said that while the committee understood that a hybrid Bill for London to West Midlands was a practical option to get work underway as soon as possible, a clause should be inserted in it stating a commitment to build at least as far as Manchester and Leeds.

“We recognise that this would not bind a future government but it might provide greater clarity and momentum,” it said.

Ellman also said that she was keen to see more information on the design for the Y network, including the number and locations of stations. The committee said this information should be published and strategically appraised before a final decision is made on HS2, partly because of the sensitivity of benefit cost ratios to changes in forecasting.

“We were told that more information would be forthcoming before the government makes its decision,” said Ellman. “I know that there is information that exists but it has not been made publicly available.”

Timeline

The government hopes to open the line between London and the West Midlands in 2026, with lines to Manchester and Leeds opening in 2032-2033.

February-July 2011 Public consultation on the strategic case for high-speed rail and the details of the London-West Midlands route
December 2011 Decision by the transport secretary on the outcome of the consultation
December 2011 September 2013 Completion ofoutline engineering design, Environmental Impact Assessment and Environmental Statement
October 2013-May 2015 Take hybrid bill through Parliament

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