High Speed Two (HS2) discussion

[WatcherZero]

So if your pressure group HS2ActionAlliance use Dft financial and environmental figures (and accepts them as roughly accurate) for their own arguments that makes them as 'water tight as rice paper' too or is it just your own personal bias of who is saying them?

http://www.hs2actionalliance.org/case-against-hs2/

If you actually read it rather than skimmed it you would find they used the raw data on local authority population from the Census, PLANET Long Distance model for travel demand, Treasury growth figures and National Passenger Survey for calibrating business trips per pound spent for each industrial sector, but threw out the Dft methodology as too simplistic (for instance grouping of 8 local authorities in London and grouping 4 in Manchester loses the fine grain of travel patterns within those cities) instead using their own finer grain analyis. As KPMG also say in the report:

We have developed a practical and transparent methodology to quantify the economic impact of investment in HS2. Our approach makes use of data and assumptions assembled to support the August 2012 economic case for HS2.

This approach builds on KPMG’s previous work in this area, considering the relationship between transport connectivity and economic output, but undertaking a more fine-grained analysis of how additional economic output is redistributed, on the basis of production cost advantages arising from economies of agglomeration together with transport cost advantages.

 

[yorksrob]

I managed to catch KPMG on Radio 4 this morning and listened with interest.

They basically said that the original cost benefit analysis didn't properly take account of the increased connectivity for business and releif on other parts of the network.

Since this is effectively saying that the current cost benefit methodology is bunkum, and since this study has been endorsed by the Minister, I look forward to the announcement that all railway projects, including line reopenings will be subject to the same methodology of cost benefit analysis as employed by KPMG from now on.

 

[ainsworth74]

For anyone interested the report can be found here.

---

KPMG are not impartial.

If you're not happy with one of the worlds largest audit companies then who, exactly, do you think should do the business case (other than the HS2 Action Alliance who really are biased)?

 

[Ironside]

I managed to catch KPMG on Radio 4 this morning and listened with interest.

They basically said that the original cost benefit analysis didn't properly take account of the increased connectivity for business and releif on other parts of the network.

Since this is effectively saying that the current cost benefit methodology is bunkum, and since this study has been endorsed by the Minister, I look forward to the announcement that all railway projects, including line reopenings will be subject to the same methodology of cost benefit analysis as employed by KPMG from now on.

That would make the case for investment in many reopenning a lot more favourable.
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As a side note it's interesting that Australia are now intending to build a high speed line on their east coast, starting with Melbourne to Sydney and then Extending further North. The article suggests a route will be safeguarded by 2015.

http://www.globalrailnews.com/2013/...high-speed-rail-line-gets-government-backing/

As australia was one of the few richer countries that didn't have a serious high speed rail plan it does reinforce the idea that building high speed rail is a normal and reasonable thing to do.

 

[jon0844]

Bah, their line doesn't even have any plan to connect into HS1 or HS2.

 

[anthony263]

Anyone watching the transport secretarys speech on HS2 live on the BBC news website now?

There is a link on the front page of the BBC2 news website.

 

[Deerfold]

From the report itself :

"Part 4 of the report

"In this section we describe the methodology (and data) used to derive initial estimates
of the potential regional economic impacts of investment in HS2."

[...]

"The impacts are clearly uncertain, and they depend on macro- and micro-level
interactions between firms, within firms and with the labour market. Moreover, they
depend on assumptions about how the economy and transport patterns will develop
in future. We have used standard assumptions for these future ‘Do Minimum’ trends
which are based on information from DfT and HS2 Ltd...."


About as water-tight as ricepaper.

Can you tell us from your crystal ball with absolutely certainty what will happen then?

 

[ainsworth74]

Dodgy accounting. "Greater London" includes the entire conurbation, not just the centre where most people work. It's telling that they then use "Manchester" rather than "Greater Manchester"

From Figure 3, 'Manchester' is refering to the area including: Bolton, Bury, Manchester, Oldham, Rochdale, Salford, Stockport, Tameside, Trafford and Wigan. Indeed if you actually read the report you'll note that they do infact refer to 'Greater Manchester' quite a bit.

 

[Carlisle]

I have just heard extracts from the Transport Secretarys pro HS2 speech ,Im sorry to say personally I found it rather bumbling and unconvincing .

 

[PR1Berske]

From Simon Jenkins in the Guardian

HS2 is crazy. The biggest infrastructure project in British history is for "club class" passengers on just one line, requiring a donation of £1,700 from every taxpayer, excluding revenue subsidy (£3,000 if the IEA is right). This in turn has been calculated at a third of a million pounds for each potential traveller diverted from the present line.

High-speed rail is no longer tomorrow's transport but yesterday's. Its development has ground to a halt even in long-distance France and Spain as using too much energy and too much subsidy. It has all but vanished from consideration in America. The benefit is to a small number of premium fare travellers, minimising the relief of capacity on existing services. HS1 from the Channel Tunnel to London may delight those few who use it, but the National Audit Office points out its passenger forecasts were "hopelessly overoptimistic".

McLoughlin may direct attention to capacity, but that is not how this line was planned or justified. If capacity is the issue, everyone knows that intercity first class is not under pressure. Commuter lines in London, the north and the west desperately need £50bn, not to mention the road network, used by far more businesses than rail.

Lines into Euston are not London's most crowded, compared with Waterloo and Paddington – the latter host to the two most overcrowded services, from Henley and Didcot. The rise in intercity passenger numbers is slackening off. As for pretending that HS2 will help "compete" with China and Japan, their trains are far more crowded than ours.

Expanding rail capacity is costly and complex, but not as much as driving a brand new pathway to Euston. Here it will not even link with Heathrow, Crossrail or the continent via St Pancras. It will not even go to Birmingham New Street. It will blitz much of London's south Camden because decades ago a rail planner thought businessmen deserved a more comfortable trip to Euston, and no one had the gumption to think otherwise. The project is completely out of date. There are not just better ways of spending money on trains, every other way makes more sense.

Source: http://www.theguardian.com/commentisfree/2013/sep/11/hs2-domestic-afghan-war

 

[AndyLandy]

From Simon Jenkins in the Guardian




Source: http://www.theguardian.com/commentisfree/2013/sep/11/hs2-domestic-afghan-war

And what does the opinion of someone on CIF have to add to the discussion? He, like you, has an opinion. It's no more than that.

 

[HSTEd]

I managed to catch KPMG on Radio 4 this morning and listened with interest.

They basically said that the original cost benefit analysis didn't properly take account of the increased connectivity for business and releif on other parts of the network.

Since this is effectively saying that the current cost benefit methodology is bunkum, and since this study has been endorsed by the Minister, I look forward to the announcement that all railway projects, including line reopenings will be subject to the same methodology of cost benefit analysis as employed by KPMG from now on.

THis report cost quite a lot of money.

That is going to make even feasibility studies on rail reopenings really really expensive.

 

[swt_passenger]

And what does the opinion of someone on CIF have to add to the discussion? He, like you, has an opinion. It's no more than that.

He (Jenkins) makes a good living just by whingeing on about anything new or different. He must have written dozens of anti-Shard articles, so successfully that it didn't get built...

 

[Muzer]

From the report itself :

"Part 4 of the report

"In this section we describe the methodology (and data) used to derive initial estimates
of the potential regional economic impacts of investment in HS2."

[...]

"The impacts are clearly uncertain, and they depend on macro- and micro-level
interactions between firms, within firms and with the labour market. Moreover, they
depend on assumptions about how the economy and transport patterns will develop
in future. We have used standard assumptions for these future ‘Do Minimum’ trends
which are based on information from DfT and HS2 Ltd...."


About as water-tight as ricepaper.

Once again, this is trying to find a business case in something that is completely moot - it doesn't matter whether or not there's a business case. It, frankly, doesn't matter if the country would never see a penny of that £50 billion or whatever again. It's simply the case that if we want more people than just the rich elite to continue to be able to use the railways, we need HS2, or something so close to it as to be almost indistinguishable. The fact that it's likely to actually make money is just (IMHO) a bonus that means it's more likely to actually get built. Whether or not it'll make the country money has no bearing on whether or not the country needs it for the benefit of its public transport.

 

[jon0844]

He (Jenkins) makes a good living just by whingeing on about anything new or different. He must have written dozens of anti-Shard articles, so successfully that it didn't get built...

Plenty of people were fighting for us to give up the Olympics and let Paris host it. They also succeeded.

Of course, those who were against the Olympics quickly changed their views once it started. Many online articles that were really negative about the costs also magically disappeared around the same time, to be replaced with ones about how proud we should all be, how we are the best at putting on grand events and the boost to the feel good factor and economy.

Funny old world!

 

[PR1Berske]

Once again, this is trying to find a business case in something that is completely moot - it doesn't matter whether or not there's a business case. It, frankly, doesn't matter if the country would never see a penny of that £50 billion or whatever again. It's simply the case that if we want more people than just the rich elite to continue to be able to use the railways, we need HS2, or something so close to it as to be almost indistinguishable. The fact that it's likely to actually make money is just (IMHO) a bonus that means it's more likely to actually get built. Whether or not it'll make the country money has no bearing on whether or not the country needs it.

There has to be a business case for building something for so much money across - initially - one part of the country, let alone taking it to the Y.

The ticket cost for HS2 -- has there been a guess yet as to how much it is going to cost in 30 years time to use this btw? -- better as heck be directed away from just being affordable to the "rich elite".

 

[HSTEd]

There has to be a business case for building something for so much money across - initially - one part of the country, let alone taking it to the Y.

Well its good that there appears to be a reasonable one.
And remember the line won't dissapear magically in a puff of smoke after 30 years, so these analyses are conservative in the medium to long term.

The ticket cost for HS2 -- has there been a guess yet as to how much it is going to cost in 30 years time to use this btw? -- better as heck be directed away from just being affordable to the "rich elite".

Less than comparable classic line journeys.

 

[Muzer]

There has to be a business case for building something for so much money across - initially - one part of the country, let alone taking it to the Y.

The ticket cost for HS2 -- has there been a guess yet as to how much it is going to cost in 30 years time to use this btw? -- better as heck be directed away from just being affordable to the "rich elite".

Even if HS2 IS only available for the rich elite (which I doubt will be the case), its mere existence and the fact that all these rich elite will no longer be travelling on the WCML will mean cheaper fares on the WCML.

 

[AndyLandy]

There has to be a business case for building something for so much money across - initially - one part of the country, let alone taking it to the Y.

There's no "business case" for the NHS or the police force either. The state makes a financial loss providing those services. Perhaps we should abolish them, too?

 

[PR1Berske]

There's no "business case" for the NHS or the police force either. The state makes a financial loss providing those services. Perhaps we should abolish them, too?

You're going to need a lot of fields for all these strawmen....

 

[Geezertronic]

You're going to need a lot of fields for all these strawmen....

Not as many as the straws that you clutch to...

 

[tbtc]

There's no "business case" for the NHS or the police force either. The state makes a financial loss providing those services. Perhaps we should abolish them, too?

There's basically no "business case" for most railway lines in the UK, if we go by cold hard stats.

Seems slightly hypocritical for people to obsess about the "business case" and cost to each person who lives hundreds of miles away, when the same rigour is never applied to other railway schemes.

For example, why should we electrify the Oxenholme - Windermere branch (the most recent infrastructure announcement I can think of)? Why should taxpayers in Penzance pay for something that they'll never use? Aren't the figures used to justify this investment all guesswork (because nobody knows exactly how many passengers will be travelling to Windermere in a few decades time)?

But rail enthusiasts don't generally worry about such things when faced with investment on a line - its generally all welcomed. Otherwise we'd be saying things like "we shouldn't reopen the Waverley route because the Corby line fell well below expected passenger numbers therefore there should never be another re-opening".

Why is HS2 so different that even "enthusiasts" are against it?

 

[AndyLandy]

You're going to need a lot of fields for all these strawmen....

So, I freely admit that my previous remark was completely facetious, but there is a kernel of truth in there. HS2, or indeed any railway, represents more than just a profit margin. It's not appropriate to assess it just on "will it turn a profit"

 

[Geezertronic]

There's basically no "business case" for most railway lines in the UK, if we go by cold hard stats.

Seems slightly hypocritical for people to obsess about the "business case" and cost to each person who lives hundreds of miles away, when the same rigour is never applied to other railway schemes.

For example, why should we electrify the Oxenholme - Windermere branch (the most recent infrastructure announcement I can think of)? Why should taxpayers in Penzance pay for something that they'll never use? Aren't the figures used to justify this investment all guesswork (because nobody knows exactly how many passengers will be travelling to Windermere in a few decades time)?

But rail enthusiasts don't generally worry about such things when faced with investment on a line - its generally all welcomed. Otherwise we'd be saying things like "we shouldn't reopen the Waverley route because the Corby line fell well below expected passenger numbers therefore there should never be another re-opening".

Why is HS2 so different that even "enthusiasts" are against it?

Or even why Crossrail (or ThamesLink) since the money currently used for Crossrail will transfer to HS2 upon its completion.

 

[tbtc]

Or even why Crossrail (or ThamesLink) since the money currently used for Crossrail will transfer to HS2 upon its completion.

Its surprising that people outside London tend to be more against HS2 (which will benefit a lot of people outside London) than they are of Crossrail (which could easily be called CL2 - Central Line 2 - since its only really about "Greater" London).

I suppose that the difference is that Crossrail gives benefits in the medium term, rather than waiting fifteen/ twenty years - which is why I think people will be more "pro" HS2 when its opening gets closer. Understandable tha tsome people find it hard to appreciate the need for it now - its a bit like telling a kid to brush their teeth today to avoid them dropping out in fifty years!

 

[The Ham]

Even if we assume that the figure of £1,700 per tax payers is right (which ignores all the tax paid by companies) then over the time it takes to build both phases of HS2 (i.e. from now till 2033, so I've assumed 19 years) then that works out as an extra £7.46 per person per month in tax (or £5.45 per person per month if up to half the cost is paid back over the 20 years after opening).

If the actual build costs are on budget (£42.6bn), then it works out as £6.22 per person per month in tax. Whilst if it comes in at £28.2bn (so £0 of the £14.4bn of contingencies are used) then it falls to £4.12 per person per month in tax (or £2.09 per person per month if up to half the cost is paid back over the 20 years after opening).

I assumed that the cost of the loan for the half of the project value doubles the amount borrowed over 20 years, however this would make the loan more expensive than most mortgages. It is also a worse case, as the actual amount required to pay off half the project costs is lower than the figures above, even though I have allowed for the full amount of interest.

However you look at it the amount it will cost each tax payer in their take home pay each month is fairly small. Even if it was totally tax payer funded.

 

[yorksrob]

THis report cost quite a lot of money.

That is going to make even feasibility studies on rail reopenings really really expensive.

The report will inevitably cost a lot of money for HS2 because it is on such a large scale and will require so much data to be collected and input.

It's the methodology that needs to be boiled down and used for smaller scale railway schemes.

 

[tbtc]

Looking at the best recommended comments on the BBC website to today's HS2 news (hoping that this is a fairer representation of the Great British Public than some more biased sites...):

I wonder which minister it is that has shares in the company who will eventually become the main contractor after the fair and transparent bidding process?

I live in Devon. How am I and my business going to benefit from HS2?

I want to see how a slightly faster train will bring billions of pounds into our economy.

How is getting from one massive city to another one a bit faster going to bring any extra money in at all

White elephant. This project needs to be cancelled immediately. These 'benefit' figures are meaningless. The costs are real. The benefits are subjective and won't even be felt until 2037! Travellers build the journey time into their plans. I find the train one of the best places to work. Get rid of HS2

I feel sure this money could be better used than on a slightly quicker train journey

An economic boost for 2037? What about now?

We'll say it time and time again, why not invest the billions into our existing railway?

it'll be an expensive white elephant at the cost of peoples houses, their communities England's quaint villages & it's countryside

From which:

• Would people rather that trains were slowed down so that they can get more work done on board?
• People don't appreciate all of the CP5 improvements planned (or current projects, like Reading), they seem to think that HS2 is the only infrastructure improvement over the next fifty years
• Why do people not appreciate that there's an economic benefit to trains being faster (when they certainly appreciate the benefits of a faster car journey, caused by a new motorway)?

 

[Chrisgr31]

Not really sure you can trust the comments on the BBCs website anyway. The reality is that grumpy people are a lot more likely to complain than happy people are to complement. Then add in to the mix that HS2 adversely affects a number of people who have a vested interest in criticising it, and the fact that it is an easy band wagon for any government hater to jump on you can guarantee that comment sites will be full of criticism and low on complements.

Personally I am looking forward to travelling north at great speed.
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KPMG are not impartial.

And you are?

 

[joeykins82]

Never read the bottom half of the internet. It's a ghastly place.