Stopping HS2 could save £40bn, say Tories
Pressure to scrap phase two of ‘white elephant’ rail project as demand for trains wanes after Covid
SCRAPPING the second phase of HS2 would fill more than three quarters of the £50billion black hole in the public finances, a report has found, as senior backbenchers called for its cancellation.
Research found that the £26billion initial estimate for the second leg from Birmingham to Manchester is likely to reach almost £40billion by 2040. Conservative MPs said Jeremy Hunt, the Chancellor, should scrap the project instead of raising taxes and cutting spending in other areas.
The report was conducted by engineering experts led by former mining engineer Trevor Parkin in Stone, Staffordshire, where construction for the second phase will soon begin.
It argues that phase two could be replaced with smaller rail upgrades, including the reopening of the North Staffordshire railway line to allow freight trains to travel cross-country.
The savings from scrapping the scheme were calculated by applying a conservative inflation estimate to its official costs, which have been published in 2019 prices. Sir Bill Cash, the veteran Tory MP who represents Stone, said: “Taxpayers all over the country are being deeply affected by the economic problems that we’ve experienced as a result of Covid and energy prices and inflation.
“This would help to stay the nation’s finances. We want to achieve a double whammy, which is to help the country and the national finances and also to help the people who are being disastrously affected by this white elephant.”
Sir John Redwood, who served as head of Margaret Thatcher’s Downing Street policy unit, said: “The business case for the huge investment in HS2 was always weak. It has been undermined by post-Covid travel demand, which is well down, affecting the argument for capacity.
“The Government should reappraise this spending.”
The report also calls on ministers to sell back the land it has already bought for phase two – as the vast majority of construction work has yet to take place – and to do so at a higher price.
Greg Smith, the MP for Buckingham and a member of the Commons transport select committee, said scrapping HS2 “could solve virtually all of the Treasury’s problems right now”.
“It’s a massive white elephant that no test of public opinion has ever found support for that is going to cost us billions, if not hundreds of billions, of pounds in its entirety.”
Public sector works that may be scaled back by Rishi Sunak’s government in the coming weeks include Northern Powerhouse Rail, a £25billion railway between Liverpool and Hull.
Liz Truss, then prime minister, last month confirmed the rail link would also stop in Bradford, but Grant Shapps, the new Business Secretary, suggested the plans would be watered down.
On Friday, Mr Shapps told the BBC: “The line itself can deliver a 33-minute journey from Manchester to Leeds, nearly quadruple the capacity of that line, and do so without having to wait an extra 20 years beyond the delivery of what the upgrade can do. There wasn’t really much point in going and blasting new tunnels through the Pennines.”
Michael Gove, the Housing Secretary, last week suggested HS2 could be “reviewed” as part of the Autumn Statement as the Treasury sought to cut costs.
“Ideally you don’t want to cut longterm capital investment, but I am sure some capital investment will be cut,” Mr Gove told Times Radio.
Downing Street denied the project was under review and Mark Harper, the Transport Secretary, insisted the Government was “committed” to delivering the project “on time and within budget”.