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The Adam Smith Institute has attacked the government’s proposals for an extension of the UK’s only high-speed rail link with a report questioning assumptions about costs, demand and financing options.
The think-tank argued in its first detailed analysis of High Speed 2 that the project, connecting London with Birmingham and eventually Scotland, would cost more than £50bn.
“Yes, HS2 may create a substantial number of construction jobs and yes, it may narrow, to a limited extent, the very wide north/south divide – but it is a very expensive way of doing so,” wrote Nigel Hawkins, a senior fellow at the institute.
Those arguments echo other criticisms of the project, the first phase of which is expected to cost £17bn and slice about half an hour off the journey time between London and Birmingham. The government estimates the wider economic benefits will exceed costs by two times, a downgrade this winter from 2.7 times.
But even those more modest estimates have been attacked by a range of critics, many of whom argue the forecasts for demand are far too aggressive. Concerns about the route, meanwhile, which is set to cut through parts of the Chiltern Hills, have goaded Buckinghamshire residents into action.
The Adam Smith Institute also questions growth projections which assume technology will allow more home working; argues the costs are at serious risk of growing even beyond HS2 planners’ provisions; and raises concerns that the Department for Transport will be forced to finance the project should the private sector balk – which Mr Hawkins expects it to do.
The Campaign for High Speed Rail fought back on Tuesday, calling the think-tank’s opposition to HS2 “purely ideological, as they are fundamentally opposed to large-scale infrastructure investment”.
“The ASI’s ‘analysis’ is just the latest in a line of reports that tries to disguise its ideological opposition to HS2 behind thinly veiled attacks on the project’s economic case,” said David Begg, director. “[They] beg the question as to why such groups failed to also dismantle the case for projects such as Crossrail and the Jubilee Line extension, which were based on far lower financial returns.”
Though devised under Labour, the coalition government has supported the project. Philip Hammond, former transport secretary, has argued: “If you are working in a factory in Manchester you might never get on HS2 but you will certainly be benefiting from it if the sales director from your company is routinely hopping on it to go and meet customers.”
His successor, Justine Greening, has raised hopes among opponents by saying her decision on whether to push ahead would be “a rational one, taking note of the many local concerns”.