HS2 rail benefits to economy 'unclear', says National Audit

[dutchman]

The economic benefits of the HS2 high-speed rail project are unclear, the National Audit Office (NAO) has warned.



In a report, the NAO said it had "reservations" about how the planned high-speed rail link would deliver growth and jobs.

It added that the project had an estimated £3.3bn funding gap.

Labour described the report as "worrying", but Transport Secretary Patrick McLoughlin rejected the report, saying the case for HS2 was "clear".

The NAO said it had "reservations about the business case" and said the timetable for the planning phase of the project - with work due to start in 2016-17 - was "challenging".

"In particular, in presenting its case for investment in the project, the Department of Transport (DfT) has poorly articulated the strategic need for a transformation in rail capacity and how High Speed 2 will help generate regional economic growth," the report said.

The department's "methodology for appraising the project puts a high emphasis on journey-time savings, from faster and more reliable journeys, but the relationship between these savings and the strategic reasons for doing the project, such as rebalancing regional economies, is unclear".

The NAO also estimates a £3.3bn funding gap for the controversial project which "the government has yet to decide how to fill".

A new estimate based on a clearer route and more information was likely to be higher than an earlier cost estimate of £15.4bn-£17.3bn, it said.

Meanwhile, it also warned that the government's timetable to start phase one of the project was "over-ambitious".

Speaking on the BBC's Today programme, one of the report's authors, Geraldine Barker, said the government needed to be upfront about uncertainty surrounding the costs and benefits of project.

"We think they need to do more work. [The objectives] they've stated is quite broad - we couldn't find the detail backing it."

Margaret Hodge, chairwoman of the Public Accounts Committee, said the business case for HS2 was "clearly not up to scratch".

"Some of their [the DfT's] assumptions are just ludicrous," she said. "There is virtually no evidence in this business case to support claims that HS2 will deliver regional economic growth, one of the key aims and justifications for this project.

"We have been told that it will deliver around 100,000 new jobs, but there is no evidence that all these jobs would not have been created anyway. The department has also set an extremely ambitious timetable for the project, with no room for mistakes."