The Conservatives originally supported HS2 as a modernisation symbol during their opposition years. It would run north from Heathrow along the M40 corridor as an alternative to a third runway at the airport. Now we are on course to have both that runway and HS2, if Boris Johnson gives the scheme the go-ahead after a review panel’s report.
That muddle over purpose is the right place to begin reviewing where HS2 has got to. Once they took office, David Cameron and George Osborne promptly reverse-ferreted (reverse-tracked?) on the scheme, and almost immediately adopted Andrew Adonis’ plan – remember him? – to run HS2 from Euston to Birmingham and beyond.
The best part of ten years on from that decision, the critics have been proved right on costs. Three years ago, the Taxpayers’ Alliance estimated that these would come in at some £91 billion, not the £55 billion originally stated. The latest calculation is £100 billion. The price could be even higher.
This site has long argued that the plan is the white elephant of white elephants – that HS2 comes with environmental, visual and communal costs; that mid-to-late twentieth century technology may be out of date by the mid-to-late twenty-first, and that one doesn’t need a high speed service to update the West Coast main line.
It would have been far better, as the ConservativeHome Manifesto argued six years ago, to scrap the scheme and re-direct the planned public investment in its entirety to a Northern Infrastructure Fund, providing core finance for a generational programme for transport and communication links between key urban centres.
Osborne is still defending HS2, and his rationale remains narrowly political – avoiding anything much to do with delivery (such as taxpayer costs and passenger use) and concentrating almost entirely on perception (such as what cancellation might mean for the Government’s image).
This is to reheat the argument that has driven the scheme: that Britain should commit itself enthusiastically to grands projets, that a U-turn would be a morale-sapping admission of failure, and that HS2 is a symbol of Conservative commitment to the north and midlands.
It is a case that will weigh heavily on Boris Johnson’s shoulders as he contemplates responding to the review panel – and to Lord Berkeley’s minority report claiming not only that the costs are out of control but that the figures have been fiddled.
The Prime Minister will be sensitive to the claim that if he, the “Brexity Hezza”, U-turns on HS2 then any big future scheme he advances – a land bridge to Ireland; his beloved new airport in the Thames Estuary, some Ozymandian space exploration enterprise – will be mocked out of its own headlines.
Junking the plan would also open him to accusations of betraying the Midlands and North. As it happens, Conservative MPs are divided about the scheme, and no less north of the Watford Gap that anywhere else. But there is a knotty political problem in the West Midlands.
Our columnist Andy Street is committed to HS2, and is up for re-election this spring. Is Johnson really going to pull the rail line from under his feet? The West Midlands Mayor is only one illustration of a broader issue. Our readers will be aware of sunk costs. These are by definition financial. But welcome to the world of sunk political costs.
John Downer’s pro-HS2 piece on this site last year is a useful introduction to the concept. At one level, the article on behalf of the scheme from a group of business leaders was what it said it was – an account of how one job-creating project can produce job-creating spin-offs.
At another, it told a story of how there is now what Ike Eisenhower might have called an HS2-Industrial Complex: contractors, suppliers, archaeologists – even, apparently, environmentalists. To mix metaphors even further, it’s a gravy train with many fingers in it. Furthermore, Phase 1 of the project is already under way.
Department of Transport officials have previously mulled pulling Phase 2 of the project – or at least Phase 2b, which would run HS2 from Crewe to Manchester and from the West Midlands to Leeds. One friend of ConHome told the site that “this would be a very British solution – a half-built railway”.
It would make Johnsonian sense to do it all the other way round: in other words, announce that Phase 2 will be undertaken first. There have been briefings that such will be the decision. But even if technically viable that would be to abandon Street – unless a reason can be found to put a decision off mañana-style.
We are not at all sure about these briefings. Paul Maynard, the Rail Minister, is said to be supportive of the scheme. Dominic Cummings is instinctively sceptical about it but has his eye on other matters. And then there are those sunk political costs: that mass of interwoven lobby interests.
It needs no genius to point out that the idea of sunk economic costs is a fallacy. That of sunk political costs may be too. Johnson will never be more powerful than in these first few months after his great election victory. If he wants to tell the HS2 lobby to take a running jump, there will never be a better time to do it than now.
And we would. But the Prime Minister is bound to be asking some very hard questions. These will include: how many alternative schemes for the Midlands and North are anything like “shovel-ready”? If our aim is to ensure that Red Wall seats gain visibly by 2024, how many would do so, were HS2 to be scrapped?
For all these reasons, we suspect that the scheme will get the go ahead – perhaps with some fig leaf to hang over the rising costs; possibly with some apparent new gain for the North. And Street will sail towards his poll in May with a good chance of being re-elected.
“I fear the worst,” one HS2-sceptic within Number Ten told this site yesterday. Steve Barclay said on The Andrew Marr Show that his “gut feeling” was that the plan will go ahead. Cabinet Ministers like Barclay don’t usually advertise what their stomach is telling them without good reason.
“We’re here because we’re here because we here because we’re here,” the old First World War song had it. So it may be with HS2. It’s here because it’s here – because a mass of political as well as taxpayer capital has been poured into the scheme. And more will come.
Slow train coming; fast train coming. On and on and on HS2 is likely to go, consuming taxpayers’ money like the furnace in some old steam monster, belching out its over-runs like black smoke – with a mass of reports and inquiries panting along in its wake. It’s a high price to pay for this legacy from Cameron’s modernisation project.
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