20 December 2010– HS2 Action Alliance (HS2AA), the not for profit organisation challenging the case for HS2, condemns the route announcement made by the government today and reiterates the urgent need to re-examine the business case for this multi-billion pound project.

“The route changes announced today do nothing to improve the economics of HS2. Plans for HS2 have been based on a flawed business case. And it’s not just HS2 Action Alliance saying this but an independent study by FTI Consultinghas confirmed that the business case for high speed rail is “over-stated, based on optimistic assumptions and exaggerated benefits”.

“This railway is not green, it will cost the taxpayer billions and the claim that it will solve the North South divide is unfounded.  Worse still, there are cheaper, greener, and more risk free alternatives of upgrading the existing rail infrastructurethat the Government refuse to debate,”explains Hilary Wharf, Director at HS2 Action Alliance.

 

The HS2 Action Alliance, has analysed the HS2 business case in detail, in a 44 page reportand identified six fatal flaws:

 

1: HS2 is not a sound investment - commercially HS2 is planned to lose money

 

2: HS2 will not deliver major wider economic regional benefits or transform the North

 

3: A new railway is not needed to solve the rail capacity problem – there are better and cheaper solutions including an alternative DfT developed.

 

4:  The UK does not need to catch up with Europe – it is actually ahead in terms of rail journey times

 

5: HS2 is not ‘green’ – it doesn’t fit as part of the low carbon economy, as it doesn’t reduce carbon emissions.

 

 6: HS2 will not greatly reduce domestic air travel –   this market is already declining.

 

More detail on the flaws in the HS2 business case is below.

 

If you would like to talk to HS2 Action Alliance’s spokesperson Hilary Wharf please contact:

Richard Houghton

07803 178 037 or This e-mail address is being protected from spambots. You need JavaScript enabled to view it.

Or Martha de Monclin

0777 168 2434 or This e-mail address is being protected from spambots. You need JavaScript enabled to view it.

 

 

Note to editors:

1: HS2 is not a sound investment – its not value for money

 

HS2 will lose money.  It will cost £25.5bn but only generates £15bn of extra fares, requiring an £11.9bn subsidy that goes to business and the affluent, inducing them to travel more.

 

A re-evaluation demonstrates overstated benefits, excessive demand, and a flawed appraisal:

• Benefits are some 60% overstated –totaling more like £13bn not £32bn (with an NBR of about 1 rather than 2.7). The largest benefit (time savings) assumes all time spent on trains is wasted, ignoring mobile technology developments
• Demand forecasts are excessive, a 267% increase - over 3½  times more than now – using out of date data and views, producing an optimistic not central case scenario
• The appraisal has failed to learn the lessons of HS1 on competition
• HS2 Ltd admit that if demand falls short by just over 20% (still a 190% increase) then the NBR will not reach 1.5 (which is an unacceptable ratio)
• The appraisal uses an unrealistic comparator (inflating the benefits) and rejects the valid alternatives developed by DfT eg of improving existing rail infrastructure
• HS2 Ltd projections and business case takes no account of new technology or indeed the government’s own initiative to reduce travel

 

2: HS2 will not deliver wider economic benefits and cure north/south divide

 

DfT/HS2 Ltd say there are extra benefits (worth £3.6bn) but this is mainly from additional local transport using freed-up existing capacity, not because of faster connectivity.

 

HS2 Ltd asked Imperial College to advise if high speed connections would lead to additional economic growth – they said very little (max £8-10m/a).  HS2 Ltd also reviewed whether HS2 might be a catalyst for other investment – but found no conclusive evidence that it would.

 

The redistributive effects (not examined by HS2 Ltd) will benefit London – not the regions. London is UK’s dominant city, seven times bigger than the next biggest city.  With 70% leisure travelers on HS2, and trips to London growing a twice the rate of those from London, money will move from the regions and be spent in London.

 

Government claims for transformational benefits are based on belief.  It is a smokescreen to hide the weaknesses in the business case and the absence of an environmental case.

 

Professor Overman (LSE), an adviser to HS2 Ltd, told the Transport Select Committee in October:

“….Claims about the “transformational” nature of transport investments for particularly areas should be generally discounted in assessing these benefits because they have no convincing evidence base to support them.”

 

3: A new railway is not needed to solve the rail capacity problem

 

We can generate 65% more capacity with just extra rolling stock on West Coast Main Line (WCML) and there is massive capacity potential on Chiltern Railways. 65% more capacity satisfies the demand forecasts made by some leading authorities.  This capacity growth could be generated without material disruption.

 

DfT’s own alternative to HS2 (Rail Package 2) de-bottlenecks WCML, delivering the required capacity by running more and longer trains (for a net cost of just £2billion) and gives a better (3.63) NBR than HS2 (2.7). Extra capacity can be developed incrementally against actual need – not relying on long-term forecasts.

 

Why this option was discarded by Government merits serious investigation.  Why spend over £0.75bn this parliament on developing plans for HS2 when a complete solution costs £2bn? There is no basis for claims of massive disruption, it’s not like the previous wholesale replacement of WCML

 

DfT’s explanation that it did not provide sufficient extra capacity – on top of meeting all the demand forecast – suggests replacing the doubtful policy of ‘predict and provide’ with the economically squanderous one of ‘predict and over-provide’.

 

4  The UK does not need to catch up with Europe – it is still ahead

 

The UK – unlike Europe – has had a fast national railway system for a long time.  As Sir Rod Eddington said in 2006, the UK has extensive fast inter-city services.

 

We also have routes capable of 200km/h (125mph) – with quicker rail journey times between the capital and the five largest cities than in other major West European countries:

• Averaging 145 minutes in UK
  • 151 minutes in Spain
  • 184 minutes in Italy
  • 221minutes in France
  • 244 minutes in Germany

 

5: HS2 is not ‘green’ – it doesn’t fit as part of the low carbon economy

 

Even DfT say it will not reduce CO2 emissions, but be ‘broadly neutral’ (and HS2 Ltd’s sums flatter HS2). Trains capable of 360km/h use more than twice the power of 200km/h trains.

 

84% of journeys on HS2 will indisputably create more emissions – all the new journeys (27%) and those switching from conventional rail (57%). 

 

A showcase transport investment such as HS2 should contribute to the UK’s target of reducing emissions by 80% by 2050.

 

 

 6: HS2 will not greatly reduce domestic air travel

 

To generate sufficient shift from air (8% of HS2 journeys) HS2 Ltd assume a 178% increase in domestic air travel by 2033 and a third runway at Heathrow.  

 

In reality demand for domestic air travel in the UK has been declining since before the recession, so opportunities for HS2 to displace air travel are reducing, not increasing.  With no third runway for Heathrow the chances of major increases in domestic air are even slighter. Rail already has 80% Manchester market, and the NW and Scottish Lowlands air market has been shrinking since 2005.

 

Were reductions in domestic air services to arise from HS2 they would be replaced by long haul services that are more polluting.

 

 

About HS2 Action Alliance

HS2 Action Alliance is a not for profit organisation working with over 60 local community groups, which is challenging the case for HS2 and working to getGovernment to take the right decisions.

 

Aims

• Communicate the facts about HS2 clearly and accurately. 
•  Provide a channel for local groups to share information and analysis, and pool resources to maximise effectiveness. 
• Question, evaluate and where appropriate challenge the economic & environmental case for HS2.
•  Identify and promote alternatives to HS2 that are in the national interest. 
• Seek to minimise the adverse impacts of HS2 on individuals, communities and the environment. 
• Work with local action and community groups, other interested organisations and businesses, to improve Government decision making on HS2