Thursday 27 June 2019

HS2 – Another Fine "Mess" that our Politicians have got the British Taxpayer into - The truth about High-Speed Rail and what our Politicians are not telling the British People


The British people are only told what our politicians want them to know. That has been the case since time immemorial, as politicians keep things very close to their chests. Indeed, what they tell us is only a fraction of the full truth and why people, not just in the UK but people throughout the world, suffer at the hands of the suppression of the whole truth.

Some are now stating that HS2 in its final completed state  could cost £150,000 million (£150 billion) and even up to £200,000 million (£200 billion and over one-quarter of the whole taxation taken from us annually).

HS2 is a point in time where our politicians have not told the British people hardly any of the facts. Indeed, if they knew what they were doing, they would have published the true facts of what had been reported around the world and where these have been hugely negative on the socio-economic outcomes and more so, the economic outcomes. That is the problem with politicians and how they operate behind the people’s back and behind closed doors. In this respect industry and business lobbyists see our politicians behind closed doors and no-one other than the politicians with their civil servants (officially sworn to secrecy under Parliamentary orders) and the industry lobbyists know what has been discussed. The next news is that things like HS2 are announced to the world and that is the first that the people ‘really’ know about such things as HS2. But of course when finally announced it is all positive for the people and the nation and no real negative overtones, but where the real truth is based upon historical evidence and in the case of High Speed rail (HSR) over the last 55 years, that HSR is not what the politicians profess and nowhere near the truth.

For what happens in the United Kingdom is that if politicians want something they will ask Whitehall civil servants to do their duty (highly paid of course and the don’t rock the boat mentality at any cost) and provide a feasibility document with a view to a ‘White Paper’. This whatever happens has to be positive for the politicians when it is released into the public domain for obvious reasons. Therefore a realistic cost is determined that may be say £100 billion, but where the politicians know that the taxpayer would not support such a project at that price, so the real price is halved or even quartered, but substantially less than what the real price is. So then when the project is released with a price tag of say £50 billion or less the people then think that this is real value for money. In the case of HS2 the cost at 2013 prices was as follows extracted from HS2: Outline Business Case Section 4: Financial Case, Department of Transport (2013)

Phase 1. - London to Birmingham – £19,400 million
Phase 2. – Birmingham to Leeds – £19,000 million
Rolling stock - £6,900 million
Total Estimate – £45,300 million
But downgraded by the DOT to £42,600 million due to purported savings.

The initial cost at 2013 prices for HS2 when it was announced to the public was £32,700 million and where this is an increase of in real terms of £9,900 million or if you take the DOT without possible savings, an increase in real terms of £12,600 million (a percentage increase of 30.28% and 38.53% respectfully and huge in itself for the UK taxpayer)

The current projected cost in 2019 according to government updates is £55,700 million reported in ‘Construction News’ (March 2019) and a further increase of £10,400 million (a £23,000 million increase to date in 2019 from its inception cost when first released and a massive 70.3% increase to date). So the question is, even before HS2 has really stated, what will the final cost be of HS2? The problem is that even the government do not know - Former HS2 boss says ‘nobody knows’ its final price tag - https://www.ft.com/content/a439af14-1e73-11e9-b2f7-97e4dbd3580d

There are also a great number of knowledgeable national institute critics that questions the merit of the government’s HS2. One of them is The ‘New Economics Foundation and where their Report “A rail network for everyone - Probing HS2 and its alternatives” released on 20 March 2019 found,


2. London was worth 23.1% of UK gross value added (GVA) in 2017 growing from 18.4% in 1997 (NEF calculations using ONS data). So, even if London increased its share of UK GVA over the next 20 years at twice the rate of the past 20 (an extreme scenario), then it would still be worth less than 30% by 2037. Therefore HS2 is not only reinforcing existing regional imbalances, it is further exacerbating them.
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3. Among households of a single adult, the top 20% by income made 20 times as many long-distance rail journeys for business during 2010 as did the bottom 20% by income. For households of two adults, the difference was even wider (the richest group took 24 times as many trips as the poorest), whereas for households with children the richest group took 7 to 12 times as many trips of this kind as the poorest group. As ticket prices for HS2 may well be higher than those for the classic network, this effect can be expected to be more pronounced.
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4. The Department for Transport demand model for HS2 assumes that between 56% and 64% of journeys between London and Birmingham, Manchester, and Leeds are made for business purposes.
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5. Some versions of the Department for Transport demand model are based on commuters having an average household income of £60,091 and leisure travellers having an average household income of £45,583 (both in 2010/​2011 prices). The median household income for the top 10% of UK earners in 2010 – 2012 was £60,700, suggesting that the HS2 demand model forecasts that its average commuting passenger will be in the top 10% of the income distribution.
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6. A comparison with France’s high speed rail shows that, just as for rail travel in the UK, the majority of long-distance high-speed rail journeys are taken by those who earn the most. People in the top 10% of incomes made 28% of all high-speed rail journeys of 80+ km in France in 2008, with this richest 10% taking nine times as many trips as the poorest 10%.


Indeed, the report makes very interesting reading and a lot of it is common-sense thinking and something that government, politicians and Whitehall do not use a great deal of based upon historical evidence of previous large national-scale thinking and more akin to a pipe dream and blue-sky thinking some might say that never translates into any practical solution or positive change for people – to read more visit the following which also has a link to the actual Report itself, “HS2 will serve wealthier passengers and deliver more benefits to London than the North” - https://neweconomics.org/2019/03/hs2-will-serve-wealthier-passengers-and-deliver-more-benefits-to-london-than-the-north
 

But overall there has not been a great deal of information disclosed concerning HS2 to date to the people of the United Kingdom (and where they are paying for the whole bill of HS2 if you did not know, as it is all borrowed money that the British taxpayer will have to pay off over decade-after-decades for at least three generations) what the real picture is and whether it is viable or not. But a few eye openers that people may not be aware of that the UK government has not been interested in telling the taxpayer is that the majority of HSR systems around the world are plagued with more negative outcomes than positive ones by far. Some are as detailed as follows and where government should know these things also, but where for some reason only known to themselves, politicians are taking no notice whatsoever of the views that are backed by overwhelming historical evidence of HSR systems spanning 55 years.
 
1.    China - People often see only the convenience of China’s high-speed rail network and boast about it being the world’s longest, but they turn a blind eye to its enormous debt and operating losses, as well as the serious deterioration of the country’s transportation structure - . Zhao Jian: What’s Not Great About China’s High-Speed Rail? The Debt, Caixin Global Limited (January 29, 2019.
 
2.    China - the HSR network is a debt crisis waiting to happen, dependent on unsustainable government subsidies with many lines incapable of repaying the interest on their debt, let alone principal - China’s high-speed rail and fears of fast track to debt - Financial times (August 13, 2018).
 
3.    China – “…the line from eastern Henan province’s capital Zhengzhou to the Shaanxi city of Xi’an as the perfect example of a white elephant rail project. ”It is basically empty,” he said. In the first six months after its launch in February 2010, the railway reported 1.98 million passengers. It was designed for 37 million a year.” - China's railway boom hurtles into the red, Reuters (June 23,  2011).
 
4.    Spain - The demand for the rail network (Alta Velocidad Española (AVE) hasn’t quite matched its scope, and that funds from Spanish taxpayers and the EU have been funnelled into a system that doesn’t serve enough customers to be worth the price. In 2016, El Pais reported that one in four AVE stations was being used by fewer than 100 passengers a day - Future Rail Railway Technology, Verdict Media Limited (25 October 2018).
 
5.    Spain – High-speed rail network is still making a loss overall, with just three profitable routes. Indeed one in four of the total of 31 AVE stations throughout the country is used by less than 100 passengers a day. Despite attracting growing numbers of passengers (up 9% between 2014 and 2015, says Renfe) the AVE is still underused. In March, some 50 million people took the train, of whom only 3.4 percent, or 1.7 million, travelled on AVE routes. – El PAIS (24 May2016). 
 
6.    USA - California has been forced to cancel the massive bullet train project after having spent and wasted many billions of dollars. They owe the Federal Government three and a half billion dollars. We want that money back now. Whole project is a “green” disaster! – President Trump (13 February 2019).
 
7.    USA - Florida’s governor Rick Scott turned down a $2bn government incentive to develop a high speed rail link from Tampa to Orlando. He believed passenger numbers to be overestimated, and that the state would have to pick up the bill for subsidies because the line would be unable to pay for itself. His decision follows very similar decisions made in Ohio and Winsconsin – The New York Times (February 16, 2011).
 
8.    The Netherlands - “The Dutch high-speed train operator could face eventual bankruptcy unless steps are taken to boost its viability, after little more than a year of full services”. However passenger numbers have increased, from a low of 15% occupancy on some trains, following the decision by the operator to reduce its price premium for high speed rail tickets – Dutch high-speed rail faces financial woes for government, Reuters (February 1, 2011).
 
9.    Taiwan - In 2009 it became necessary for the Taiwanese government to take over the running of the Taiwan High Speed Rail Corporation as it was almost bankrupt, two years after it first started running its high speed trains. One of the contributing factors to the financial problems was that passenger numbers were approximately one third of those that had been forecast - Near-bankruptcy of the Taiwan High Speed Rail Corporation: What Went Wrong?, International Journal of Business and Management (IJBM) (2010).
 
10.   France - “We risk having longer and longer high-speed lines which are used less and less“; so said the president of the SNCF, Guillaume Pépy. He thinks that France is going too fast in its further construction of high speed lines. TGV fares have increased by 100% in the last decade compared to about 30% for car travel. Pépy went on to say: “The whole basis of the high-speed rail revolution – that the TGV should be the “normal” means of travel, not just something affordable by the business elite – is under threat”. The SNCF president also described the state railways as: “Decaying… facing a financial impasse… and heading for the wall”. He should know better than most - Life on the fast track: Thirty years of the TGV, The Independent (9 April 2011).
 
11.  United Kingdom – HS1 where 18 Javelin carriages were taken out of service four months after the line was completed in 2009 due to low passenger usage. In April 2011 a Telegraph reporter noted there were more than 200 empty seats on a peak time train leaving St Pancras at 6:10pm. Off peak usage was described as 90% empty - High speed rail? Britain's first link hasn't worked as planned say critics, The Telegraph (2 April 2011).
 
12.  United Kingdom - Taxpayers have been saddled with a £4.8bn debt from the Channel Tunnel high-speed rail line (HS1) so far, a report by a committee of MPs has said. The Public Accounts Committee blamed over-optimistic forecasts about the number of passengers using the service. It predicted that the final bill for the London to Folkestone line would rise to £10.2bn (£10,200 million) by 2070 – BBC News (6 July, 2012).
 
13.  United Kingdom - ...the report suggests that the impacts of high speed rail investments on local and regional development are ambiguous at best and negative at worst. It is very difficult to find unambiguous evidence in support of the contentions that are being made by the government? about the potential impacts of HS2 on the cities and regions of the UK - High Speed Rail: The Local and Regional Impacts of High Speed Rail in the UK: A Review of the Evidence, Select Committee for Transport, UK Parliament (Session 2010-2012).
 
14.    India - The Mumbai-Ahmedabad bullet train is a vanity project which has little or no justification on the grounds of economic viability or public service. Even the vanity angle — looking to position India among the ranks of developed countries — is a huge overreach. Only a handful of high-income countries with specific demographics have high-speed rail (HSR), while many have failed in their efforts, others have abandoned it after studying it. The main problem is viability, given the huge costs involved - Does India need a bullet train?, The Hindu (October 16, 2017).
 
15.   The Netherlands-Belgium-France - The Thalys (HSR) is two to three times as expensive as the Étoile du Nord (standard railway system), while it's only 25% faster. For most people, the time gained by taking the high speed train is not worth the extra cost. However, since the Étoile du Nord has vanished, they are left no other choice than to pay more when they want to travel by train - High Speed Trains are Killing the European Railway Network, Low Tech Magazine (December 16, 2013).
 
16.    The EU - The European Court of Auditors issued a report in late June critical of Europe’s development of high-speed rail… the report for the taxpayers, who have provided virtually every Euro of financial support to plan and construct high-speed rail in Europe. Only the Paris to Lyon route has been profitable including its construction costs – Special report n° 19/2018: A European high-speed rail network: not a reality but an ineffective patchwork, The ECA (26/06/2018).
 
Although there is a far more evidence than the above that HSR systems are not a viable and financially sustainable transport system (from start to operational) , viewed on global evidence, the conclusion is that the majority of High-Speed Rail (HSR) schemes are not viable, increase vast debt, have to be subsidised to survive, affect other transport systems financially and overridingly show  that government analysis overestimates demand for high speed rail lines. Indeed as a single example, Aalborg University found that nine out of ten rail projects that they studied in-depth, overestimated passenger demand and where the average overestimation being 106%. Overall, it is apparent therefore that governments (including the UK) just do not do their evaluation process realistically or correctly when it comes to HSR schemes and where HSR cost the taxpayer dearly and once built, in perpetuity. 

But will our politicians listen and take into account the evidence that is out there and allow this largest of tax-burden ‘white elephants’ in modern times to proceed and be forced on the British people?. Probably and where based again on historical evidence such as BREXIT for example, they never listen to the people who elected them into Parliament and where 75% of politicians voted against BREXIT. So take heed Parliamentarians, as the people will not take another big knock against their national views even it is right or wrong, as you appear to have taken democracy now to a level of a parliamentary dictatorship and not what the voters expect, democracy for the people.  

Let’s hope though for once that our so-called astute and informed political masters use common-sense and scrap HS2 based upon true facts, not crystal ball gazing that only ends up in the nation becoming more bankrupt by the decade and which of course harms the very people who voted them into office and their future generation.



The Alternative for a  Guaranteed and Continuously Growing Dynamic Future for the UK Economy and the People of Britain

But a far better way to spend over £100 Billion which will be all borrowed money (that's what it will be with interest and capital loaned paid back by the taxpayer for decades and probably at least 4/5 decades, based upon the way that the global economy is heading) would be the construction of the £30 billion Western Water Highway Project that would alleviate road transport pressures by up to 47% (and predominantly heavy goods) together with the nation's upgraded rail links and the £65 Billion overarching cost for the Open Research Establishment (The ORE) with its regionally interconnected ORE-Incubator satellite centres strategically located throughout the United Kingdom and the "Commonwealth" and other partnering nations. For this would provide the most advanced economic catalyst in the world and the most dynamic development mechanism within the UK never seen since the first Industrial Revolution that transformed the nation into the technological powerhouse of the world. These two mega-national projects would do literally the same, but even more so, as they would provide full time jobs and wealth creation for the nation in perpetuity, but where the HS2 £100 billion+ rail link that is basically designed to fail economically when based upon the evidence of other countries and which will have to be continually subsidized by the taxpayer like a lead weight around the British people's neck. This is totally unlike these two national/international projects for the United Kingdom that would completely transform the nation into the highest per capita nation in the world according to economic predictions after a mere 10 years of their completion.  

Dr David Hill
CEO, World Innovation Foundation

27 June 2019 (updated 25 January 2020)



References:
Government misleads public as HS2 has been £9bn over-budget for 4 years, says Commons report - http://stophs2.org/news/18461-government-misleads-public-4-years-hs2-9bn-over-budget-commons-report

One in four AVE stations used by fewer than 100 passengers a day - https://elpais.com/elpais/2016/05/23/inenglish/1464003478_520592.html



BREXIT - UK Members of Parliament do not know what they Vote For and 'Why' They 'Never' get it right, not even when a Majority of 17.4 million British voters wanted it and voted for it - https://worldinnovationfoundation.blogspot.com/2019/03/brexit-uk-members-of-parliament-who-do.html

After Spending $5.4 Billion, California’s Bullet Train Is Still Going Nowhere - https://www.hoover.org/research/after-spending-54-billion-californias-bullet-train-still-going-nowhere

RFG warns UK’s HS2 high-speed rail project could cost double initial estimates - https://www.governmenteuropa.eu/high-speed-rail-project-could-cost-double/85968/


Cost of HS2 is 'out of control' and trains may never reach the North - https://www.birminghammail.co.uk/news/midlands-news/cost-hs2-out-control-trains-16279547



HS2 rail scheme essential, say MPs – But the Commonsense is in the Comments, not what our politicians have been brainwashed by Whitehall with and their lies  - http://www.newsmulti.com/uk-news/2013/dec/13/hs2-rail-essential-mps-transport-committee 



Over budget and out of date: The overwhelming case against HS2 - https://capx.co/over-budget-and-out-of-date-the-overwhelming-case-against-hs2/ 


Revealed: HS2 'abysmal value for money' at 10 times the cost of high-speed rail in Europe - https://www.telegraph.co.uk/news/2016/03/21/revealed-hs2-abysmal-value-for-money-at-10-times-the-cost-of-hig/ 

The high-Speed gravy Train: IEA Current Controversies Paper No. 46 - Interests, Transport Policy and Government Spending - https://iea.org.uk/wp-content/uploads/2016/07/The%20High%20Speed%20Gravy%20Train_0.pdf 



HS2 has cost us £1bn so far and it hasn’t even been officially approved yet - https://www.51m.co.uk/hs2-has-cost-us-1bn-so-far-and-it-hasnt-even-been-officially-approved-yet/ 

Initial costs for HS2 civil works costs are £1bn over budget - https://www.cityam.com/initial-costs-hs2-civil-works-costs-1bn-over-budget/ 

HS2 budget ‘will balloon to £80bn’, says secret report - https://www.thetimes.co.uk/article/hs2-budget-will-balloon-to-80bn-says-secret-report-r9qtwpbpl 

Post Carillion, now is the time for HS2 to hit the buffers - https://reaction.life/post-carillion-now-time-hs2-hit-buffers/ 


4 Reasons California's High Speed Rail is a Terrible Idea (And Not Likely to Go Far) - https://www.atr.org/reasons-californias-high-speed-rail-terrible-a8061 


HS2 will serve wealthier passengers and deliver more benefits to London than the North - https://neweconomics.org/2019/03/hs2-will-serve-wealthier-passengers-and-deliver-more-benefits-to-london-than-the-north 


High Speed 2: The best we can do?Creating more value from £33 billion- https://neweconomics.org/uploads/files/6deec6da8eb212246d_jsm6iqoq5.pdf 

Regional planning professor unmasks the Truth behind HS2 spin - http://stophs2.org/news/8950-regional-planning-professor-unmasks-truth-hs2-spin

Is Spain’s high-speed railway a case of ‘too much, too soon’? - https://www.railway-technology.com/features/spain-high-speed-railway/

EU Auditor High-Speed Rail Criticisms: Lessons for North America and Australia - http://www.newgeography.com/content/006033-eu-auditor-high-speed-rail-criticisms-lessons-north-america-and-australia 

Does California owe the federal government billions from its canceled rail project? - https://edition.cnn.com/2019/02/14/politics/high-speed-rail-fact-check/index.html 

Some countries are facing problems with their high speed railways - http://stophs2.org/news/2719-countries-hsr-problems-high-speed-railways 

HS1 Channel link leaves £4.8bn debt, says MPs - https://www.bbc.co.uk/news/uk-18733308 


High Speed Rail - Written evidence from Professor John Tomaney (HSR 14)
The Local and Regional Impacts of High Speed Rail in the UK: A Review of the Evidence – UK Government Select Committee (Session 2010-12)  - https://publications.parliament.uk/pa/cm201012/cmselect/cmtran/writev/rail/m14.htm 

 













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