The planned high speed rail link between London and the North of England will cost at least £88bn, according to a new report by the TaxPayers' Alliance.
HS2 aims to increase the capacity of north-south infrastructure links, rebalance the economy to make it less London-centric and support an estimated 25,000 jobs.
In the 2015 Autumn statement, the government earmarked £56bn to build the HS2 rail line London to Birmingham by 2026, and then from Leeds to Manchester by 2033.
However the TaxPayers’ Alliance (TPA), a think tank and pressure group, said the government’s estimates did not account for “all of the development required… for the full economic benefits to be achieved”, such as regeneration of the areas around train stations.
“HS2 is a wasteful vanity project which is unlikely to be completed on schedule and will cost taxpayers a fortune. The new Prime Minister should now be pursuing bold and imaginative policies to boost economic growth and increase productivity – and that positive approach must include scrapping HS2,” said Jonathan Isaby, chief executive of TPA.
The TPA report said demand for HS2 was uncertain, raised concerns it would not have the desired effect on the economy in the North and said better value for money projects were possible.
Modest improvements in speed and frequency on the West Coast Main Line, a reduction in the number of first class seats and targeted infrastructure projects could be more than three times more cost effective than HS2 the report said.
The report also warned improving HS2 would not have the impact predicted impact on the northern economy. Improved transport links from London to the north could increase the competitiveness of London based companies in “harder to reach markets” and hold back growth of regional businesses it said.
The TPA report follows one from the National Audit Office (NAO), the government spending watchdog, which called HS2’s delivery schedule “too ambitious”. It warned local growth benefits would not be realised unless the funding could be found for local regeneration.
The NAO also said HS2 was forecast to exceed available funding for phase one from London to Birmingham. “If costs are closer to, or exceeding, available funding… then the benefit-cost ration, including wider economic impacts, would fall,” it said.
The Department for Transport has not yet responded to a request for comment on TPA’s report.
Simon Kirby, chief executive of HS2, commenting on the NAO’s report, said: “The role of the NAO is to challenge projects such as HS2... This report does this and we accept that challenge. It also, however, recognises the real progress we have made in taking the concept of HS2 and moving it nearer reality."
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