High Speed Rail (Preparation) Bill

Lord Howard of Rising Excerpts

Tuesday 19th November 2013 Lords Chamber

[Lord Howard of Rising (Con)]

My Lords, this country’s debt is increasing at a rate in excess of £100 billion a year. I find it hard—almost impossible—to believe that in these circumstances Her Majesty's Government propose to enter into a financial commitment the case for which—I say this in spite of the eloquence that I have heard today—looked at in the very best, kindest and most positive way, is weak. Looked at in any normal way, HS2 is, frankly, insane. No sane businessman, dealing with his own money, would dream of making an investment based on the criteria being used to justify HS2.

Granted, the economy is improving, so that by the time bills have to be paid the financial position might be better, but the country will still have a burden of £1 trillion of public debt to deal with. There is no certainty about what the project will cost. I do not think anyone knows. In 2008 the cost was estimated to be £17 billion, in 2010 the estimate had increased to £30 billion, in 2012 it was up to £33 billion, and this year the figure has increased to £42.6 billion. And that is without counting the cost of the odd £10 billion for rolling stock. For what it is worth, the Financial Times has estimated the true cost to be £73 billion. Who knows what the final cost will be? Major Government spending plans have a habit of going over budget distressingly frequently.

Until quite recently the main argument to support this project has been the financial benefit to be gained from faster train journeys, because they would give more time for travellers to get on with their affairs—indeed, 79% of all benefits in the business case for HS2 are attributed to these savings. However, the vast majority of passengers on trains do get on with their business: reading, writing, using laptops and so on. They do not just sit there doing nothing. If the proponents of this Bill had ever sat on an intercity train they would have seen this. As a businessman who has never had a head office, but has had interests all over the country, I have spent many hours travelling; half an hour more or less on a train has never mattered. In practice, travelling time on trains is useful, as it enables one to get on with things, such as writing and reading, without interruption. The other point your Lordships might care to note is that the time-saving calculations assume trains travelling at 140 mph—a speed not yet achieved.

More important is the time spent journeying to and from stations, when it is considerably more difficult to use the time to good effect. In five of the seven main provincial cities to be served by HS2 trains, the line will not even go into main railway stations. In Sheffield, Nottingham and Derby the HS2 station will be 10 miles from the city centre. With the extra time required to get from the station to the final destination, one has to question whether there will be an overall time saving at all: will the journey door to door take just as long with HS2 as it did before?

With increasing recognition of the weakness of the time argument, the justification now being emphasised is the need for the extra capacity that HS2 will provide. How this will happen with, for example, the number of platforms at Euston presently used for existing services being reduced from 18 to 13 is difficult to understand. Figures that became available in December 2012 as a result of a judicial review show that intercity trains on the west coast main line were only 52% full in the evening peak period, and there was still scope to increase the size of trains if necessary. In spite of what the noble Lord, Lord Adonis, said, I believe that if there is a need for spare capacity there are other and considerably cheaper solutions.

The existing line could be upgraded. Claims that this would take 14 years and cost £19 billion have been comprehensively rubbished by a number of different commentators—so much so that the objectivity of the arguments in favour of HS2 must be seriously suspect. In any event, it would take 17 years before both phases of HS2 were complete.

There is also the possibility of opening up the Chiltern Line, another cheaper alternative. We are a trading nation and depend on the trade we do with other countries, be it in services or manufactured goods. To be effective we need the best possible communications with the outside world. It beggars belief that Her Majesty’s Government are proposing to spend quantities of billions of pounds on a project for which the business case does not even stand the most cursory examination, instead of getting on with increasingly desperately needed airport capacity—something the Minister hardly even mentioned in her long list of money to be spent on transport. Even today there is an article by Sir Martin Sorrell in the newspapers begging for better airport capacity. I urge the Minister to have a look at this side of life as well as the trains.

[Lord Faulkner of Worcester (Lab)]

My Lords, I hope that the House will forgive me if I do not follow the noble Lord, Lord Howard of Rising, in all the points he made. Needless to say, I disagree with every single one of them. On the question of cost—

[Lord Howard of Rising]

How flattering.

[Lord Faulkner of Worcester]

On the question of cost, to which he referred, if he reads the speech by his noble friend Lord Heseltine to the Royal Town Planning Institute, he will find that a number of those issues are addressed and answered very fully. I draw his attention to the fact that the noble Lord, Lord Heseltine, refers to the Government selling a 30-year concession in 2011 for High Speed 1 to a Canadian pension fund for £2.1 billion. I understand that something in the order of £10 billion could be realised for a similar concession on HS2, and there is a great deal more of the same.

I start by thanking the Minister—the noble Baroness, Lady Kramer—for convening the meeting for Peers with her officials last Tuesday. I certainly found it helpful and informative and left the Committee Room hopeful that this Bill and, indeed, the whole High Speed 2 project are in good hands. As we had such an excellent debate on High Speed 2 in your Lordships’ House on 24 October, there is no need for me to go over the ground that I covered then. However, I am grateful to the noble Baroness for quoting a sentence from what I said that evening.

The important thing that came out of the debate was a demonstration of the overwhelming need to add capacity to our railways as a consequence of the phenomenal growth in demand for rail transport over the past 20 years. Passenger demand has doubled since 1995. As the noble Lord, Lord Rodgers, is still in his place, I will go back to 1976 and recall a conversation that Sir Peter Parker had with Tony Crosland, who was then Secretary of State for the Environment, which Sir Peter wrote about in his autobiography. He said that he was depressed by Tony Crosland saying to him:

“Peter, I see a future for BR as a smaller, sensible little railway”.

Spare capacity was ruthlessly removed throughout the 1970s and 1980s as BR desperately tried to cut costs to meet the financial objectives imposed on it by the Treasury, about which my noble friend Lord Adonis spoke so eloquently earlier. Therefore, it is no wonder that more capacity is needed for the railways now.

Given the gloomy forecasts for passenger and freight demand produced at that time, which were all proved hopelessly wrong within 10 years, I am reminded of the words of the great economist John Kenneth Galbraith, who said:

“The only function of economic forecasting is to make astrology look respectable”.

The lesson we should have learnt, post Beeching, is that you must keep your options open, retain the flexibility for future growth and never sell the track bed as it is a resource that must be protected.

At the Minister’s meeting on Tuesday I pointed out that the task of building a high-speed railway to the Midlands and the north would have been much easier if previous Labour and Conservative Governments had not closed the Great Central Railway—the last main line to be built in Britain until High Speed 1, and the only main line, until High Speed 1, built to the continental gauge. One of its routes to Rugby, Leicester, Nottingham and Sheffield went straight through the Chilterns, including the towns of Amersham, Great Missenden and Wendover. I am sorry that my noble friend Lord Stevenson is not here to—