High-speed rail: the greatest waste of public money after aircraft carriers
HS2 will cost taxpayers £1bn a year in interest alone, all so a few rich business people can get to Birmingham earlier

Simon Jenkins , The Guardian Tuesday 10 January 2012
http://www.guardian.co.uk/commentisfree/2012/jan/10/high-speed-rail-waste-money-hs2?CMP=twt_gu

The go-ahead for the £32bn High Speed 2 railway to the Midlands makes it the biggest public project in peacetime. It also qualifies as the worst. Objection has nothing to do with taxpayers' money enraging Tory shires, much as this delights the left. It has little to do with the loss of beautiful countryside, which should at least count for something. The fact is that a vast sum of money is going on a single upmarket project whose chief feature is its extravagant glamour. HS2 is gesture spending dressed up as growth. It is Concorde for slow learners.

Rail buffs love high-speed trains for making a nerdish hobby seem visionary and modern. That is the long and short of it. Super-speed rail is suitable for countries with cheap energy and long distances between stops, which is not England. It is costly in electricity and depends on premium fares to pay its way. The Whitehall evaluation team more or less shut up shop last year as energy costs soared and the benefit/cost ratio plummeted from 3.24 to 1.60, normally enough to kill any project. With a delivery date deep into the 2020s, the Treasury must have gone to sleep.

The new railway will do nothing for the recession, be voracious of carbon and do little to ease road congestion. To be remotely commercial, it must charge high fares – projected to rise at 27% over inflation – and be largely a replacement service for business travellers from Euston, whose first-class carriages are often near empty. The option of longer platforms, more overpasses and more standard seating carriages on existing lines has been dismissed by Network Rail (at the request of the Transport Department), but this study made no mention of value for money. Reusing existing corridors might, as Network Rail says, be "disruptive", but hardly disruptive to the tune of £32bn.

There is still no published strategy for rail investment in Britain. If there were, HS2 would never survive against electrifying the western region, or improving Britain's ramshackle cross-country services, or upgrading the intolerable state of most urban commuter services. The project only survived its last evaluation crisis because the Tories in opposition said it was an "alternative" to a new runway at Heathrow. The runway had nothing to do with the case, as HS2 goes nowhere near it. This was like proposing a school as an alternative to a hospital.

What motivates ministers to these gigantic projects remains a mystery. Commercial lobbyists claim that HS2 would be "worth £55bn to business", which makes it odd that they are risking a penny on it. Lord Adonis, HS2's long-standing cheerleader, calls it "the incredible democratisation … of low-cost mass-market high-speed transportation". HS2 has nothing to do with democracy, let alone the poor. Adonis's trains will be for the rich.

To encourage the poor to travel – a strange objective in a carbon-conscious age – we should improve coaches and roads, the poor man's highway, which are miserably overcrowded. A government that has billions to spare for HS2 this week could not even keep open London's rotting Hammersmith flyover. Friday nights at Euston may be crowded, but so is Friday night on most of the motorway network. "Predict demand and supply capacity" no longer applies to roads or hospitals. Why should it apply to trains, where at least the peaks can be managed by price?

The case against HS2 should never have been left to lovers of countryside, rather than to other transport users or taxpayers in general. This has played into the hands of the construction lobby, which has shrewdly allied itself with the naive left in depicting opposition to HS2 as confined to Tory nimbys. They can be dismissed by Cameron's macho urban court as effete and "anti-enterprise".

Modern government is addicted to multibillion-pound prestige projects, from aircraft carriers and health computers to the Olympics and HS2. This reflects the power of headlines, but also of industry lobbyists embedded in the Whitehall machine. Last week the chairman of the committee on standards in public life, Sir Christopher Kelly, warned that "preferential access to decision-makers" by powerful interests was damaging respect for Whitehall. But what he merely called "no smoke without fire" is a raging inferno, influencing campaigns for military procurement, runways, academy schools and planning changes.

The HS2 lobby has been led by contractors and consultants who manoeuvred themselves into what has become almost an arm of government. They promised ministers and officials untold glory in return for contracts. The lobby was actually set up by transport officials in 2009 to press their case, largely with the Treasury.

Since then the HS2 project has been allocated an astonishing £750m of public money – enough for how many schools or hospitals? – without a single spade being turned and before any decision was made to go ahead. As with Crossrail, the scale of spending and interests at stake banished reason and made the project unstoppable, besotting one transport secretary after another. The latest, Justine Greening, gasped over her plan today like Ahmadinejad over his latest nuclear enrichment plant.

This is money beyond all sense. It could have supplied trams to every big city in Britain. The truth is that railways, since their pseudo-privatisation in the mid-90s, have been consuming subsidy at five times the rate they did when nationalised. They take 20 times more bureaucrats to oversee them, while fares have risen to as much as 10 times the European average. Rail oversight has been one of the great failures of modern British government – without a word of inquiry or remorse.

Service quality is at the mercy not of professional managers, but of passing politicians with no knowledge of transport economics, besieged by company lawyers, the Office of Rail Regulation and the Health and Safety Executive. They all pore over hundred-page contracts and risk assessments, measuring costs against subsidies and fines, hiring and firing subcontractors with abandon.

The rail lobbyists have now achieved the grandest squander of public money after warships and computers, and these at least can be scrapped without wrecking the Vale of Aylesbury. Taxpayers must now find £1bn a year in interest payments alone, so a few rich business people can get to Birmingham half an hour earlier. Cameron and Osborne should never again complain about Labour debts. They have allowed through a thoroughly bad project.