Economic Case for HS2 (Economic Affairs Committee Report)

Lord Rodgers of Quarry Bank Excerpts

Wednesday 16th September 2015 Lords Chamber

[Lord Rodgers of Quarry Bank (LD)]

My Lords, I was unaware of the Government’s response to the Economic Affairs Committee report of 25 March until this debate appeared on the Lords’ daily business paper. As an outsider and not a member of the committee, I find the response disappointing and dismissive. I have said on a previous occasion in the House that I am agnostic about the merits of HS2, as currently planned, and many agnostics want to believe. Alas, the response does not help towards the necessary faith in what seemed a glamorous but—as it has turned out to be—an inadequately considered project.

The report and the response should be seen in the context of the wider discussion about the railways. I am confused by the Government’s intentions. On 7 June, they initiated a debate in the House called, “North of England: Transport”. Many noble Lords spoke with enthusiasm of Hull, Newcastle, Derby, Leeds, Merseyside, Cumbria and elsewhere and about the prospect of better connectivity and improving the infrastructure. As we know, one of the important matters was the trans-Pennine electrification. In the report, the noble Lord, Lord Ahmad, struck an optimistic note saying,

“before you bring any strategy together, you need to have the vision”.

Later he said that electrification was a priority and,

“we will seek to move forward on that at the earliest opportunity”.

The noble Lord, Lord Ahmad, wound up by quoting the noble Lord, Lord Prescott, that it was,

“all right to talk but it is time to get on with it”.—[Official Report, 17/6/15; col. 1210-15.]

The noble Lord, Lord Ahmad, made a positive and upbeat speech. That was on 17 June in this House.

But eight days later, on 25 June in the House of Commons, the Secretary of State for Transport, Patrick McLoughlin, made a Statement on the publication of the annual report of Network Rail. Some things were working well, but he did not pretend that everything was perfect because it was not. Then followed a damning critique of Network Rail in which the chairman was sacked and which ensured that some of the executive directors would receive no bonus. The Secretary of State set out a review of priorities. On the Midland main line there could be “speed improvement”, but electrification would be “paused”, as was mentioned earlier by the noble Lord, Lord Hollick. There would also be a pause in the current work on the trans-Pennine route. It was a deeply worrying Statement about the railways, and very different in mood and style from the buoyant speech of the noble Lord, Lord Ahmad, a few days earlier.

I have a concern and a question. The annual report that the Secretary of State referred to was the first annual report of Network Rail since it was reclassified as a public body in September 2014. But the unsatisfactory output of the organisation was not a sudden event. Since then, the Secretary of State tells us that the present chief executive Mark Carne has had to review the organisation’s structure, performance and accountability and has made changes. However, the chief executive of Network Rail from February 2011 to April 2014 was Sir David Higgins, who is now the chair of HS2. My question is this: do the Government still have unqualified confidence in Sir David’s ability to handle the current problems, including the economics of HS2, and successfully carry forward the project on time and within price? I would be grateful for a ministerial answer today.

I have a further anxiety about the railways. A letter dated 6 August from the Office of Rail Regulation was copied to the Secretary of State for Transport covering a period of six months to 31 March. It identifies and lists areas of weakness, including inadequate governance of projects, inconsistent consideration of safety issues and low productivity. It also states that in some areas, the quality of data that Network Rail relies on to plan and manage its works on Britain’s railways is not acceptable. In summary, the letter states, “We consider that the wide range of identified weaknesses indicate that NR’s project development and delivery weaknesses are systematic rather than the result of individual projects failing or adverse circumstances”. While this letter refers to Network Rail, how can we be confident about the prospect of it handling HS2?

The introduction for the government response to the Economic Affairs Committee report is unyielding. There is the usual hyperbole that is familiar in the growing literature of HS2, while in contrast there is the hard-headed Statement made by the Secretary of State on 25 June. I would welcome the authors of further HS2 documents showing some openness and fair-mindedness rather than rejecting the views of those who remain unhappily sceptical about a huge and complex project.