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No 'convincing strategic case' for High Speed 2, warn MPs

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The Public Accounts Committee has slammed the government for failing to put forward a ‘convincing strategic case’ for High Speed 2 (HS2)

The MPs, who claim the Department of Transport has made decisions ‘based on fragile numbers, out-of-date data and assumptions which do not reflect real life’, join a growing number of dissenters over the viability and benefit of the £42.6 billion project.

Last month former chancellor Alistair Darling warned HS2 had become too expensive and could drain the railways of investment while a recent poll of Institute of Directors members found 70 per cent believed the scheme would have no positive impact on the productivity of their business.

Committee chair Margaret Hodge also feared for the future of the project, which has already seen its budget increase ‘substantially’ as the route ‘design developed’.

She said: ‘The pattern so far has been for costs to spiral - from more than £16 billion to £21 billion plus for phase one - and the estimated benefits to dwindle.’

The report also torpedoed the assumption that train travel was ‘dead time’ for commuters. The document reads: ‘It assumes business travellers cannot and do not work on trains using modern technology. Furthermore, the business case does not include a complete cost for the impact of disruption, for example, to local businesses during construction.’

The committee reported that HS2 had so far spent £185 million on consultants ‘mostly on the development of phase one, including the route design and the environmental statement’.

It is expected that more than £500 million will be outlayed on engineers, architects, masterplanners and other consultants by the end of March 2016.

However the committee absolved Arup of any fault in the cost hikes related to the reworking of Euston - the London terminus on the high-speed link which will run to Birmingham and eventually Manchester and Leeds.

The report reads: ‘The plans for Euston station provide an example of how cost estimates have increased. The cost estimate has risen by £400 million from £1.2 billion in January 2012 to £1.6 billion in 2013, even though the proposed scheme is now simpler as it no longer involves demolishing the entire station and rebuilding it with the platforms at a lower level.

‘The changes in the plan for Euston are due in part to a greater understanding of the effects of trying to keep the station open during construction. In HS2’s view the £400 million under-estimate was a reflection of the level of the design at the time rather than a mistake by Arup, who advised HS2 Limited on the Euston cost estimates. The largest three cost increases on Euston station are due to: additional allowances for continuing operations (£205 million), increased unit rates (£205 million) and increased contractors’ set-up costs (£280 million).’

Last week Bennetts Associates unveiled plans to create a new urban quarter around an overhauled Manchester Piccadilly Station in the expectation of HS2’s arrival into the city.









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