High-Speed Rail

Debate between Craig Whittaker and Andrea Leadsom

Thursday 31st March 2011 Westminster Hall

[Andrea Leadsom]

I am struggling to follow some of my hon. Friend’s numbers, because I think that he might be looking at the numbers from the original business case, not from the current one. I do not want to address his points specifically because those numbers do not quite register with me. I apologise for that.

Passenger forecasts are another major assumption in the business case, relying on a 216% rise in demand for train travel. That figure remains wildly optimistic, in spite of being downgraded from the original business case, in which growth of 267% was forecast. The Department for Transport’s own national travel survey shows that overall transport demand is no longer growing with GDP. Eurostar’s passenger numbers in 2009 had reached only 37% of the level that was forecast, as a result of building the HS1 link. The Public Accounts Committee took evidence from the Department for Transport on that point and was reassured by it that lessons had been learned and that any future major project would factor in more severe downside assumptions—that has clearly not been the case. The only comparable forecasts for long distance rail travel by 2036 are from Network Rail, which predicts a range of growth of 45% to 89%, versus that forecast by HS2 Ltd in its original business case of 133% growth by 2033. I urge the Department for Transport to look closely again at that assumption.

Of course, in cash terms HS2 will never pay for itself. Once built, only one third of the total claimed benefits will be captured through fares. The value of the net revenues once it has been built—with a presumption of fares of £14 billion, less operating costs of £6 billion over a 60-year project life—will cover only less than half of the capital costs. At a time when families up and down the country are feeling the pinch, we must make sure that infrastructure projects offer value for money. Many people would argue that not a penny will be spent until 2015 anyway, but between 2009 and 2015 the Department for Transport expects to spend around £1 billion just on preparing the way for high-speed rail.

Secondly, on the environmental impact, HS2 Ltd itself says that the project is, at best, carbon neutral. It predicts that 65% of passengers will either transfer from existing rail services, where faster trains inevitably increase carbon emissions, or are additional new journeys as a result of the faster trains, which will also increase emissions. The shorter journeys by air that will transfer to HS2, will ironically, as my hon. Friend the Member for North Warwickshire (Dan Byles) said, provide more capacity at our regional airports for cheaper long-haul flights. It is estimated that the modal shift from car to high-speed train will be approximately 7%. In fact, HS2 Ltd forecasts that the traffic volumes on the M1 will be reduced by only 2% as a result of HS2. So, it is not green. There will also be a significant environmental impact during construction, as well as permanently, to the English countryside, wildlife and historic sites.

Thirdly and fourthly, on the prospects for job creation and regeneration, the Department for Transport claims that HS2 will create 30,000 new jobs. Some 9,000 will be construction jobs and are likely to be temporary. The rest are skewed towards property development and retail near stations.

[Craig Whittaker (Calder Valley) (Con)]

It is not often that I am at odds with my hon. Friend and her point of view. However, only yesterday 90 business leaders from Yorkshire published an open letter in the Yorkshire Post, which sent a resounding message to the Government and said very clearly that high-speed rail is vital for Yorkshire’s success in the future. Who is right: the 90 business leaders in Yorkshire, or my hon. Friend?

[Andrea Leadsom]

I agree with my hon. Friend that it is very unusual for us to disagree. The reality is that we all share the same goal: to regenerate our economy and to provide good value for money to the taxpayer. What we are arguing about is how we achieve that. Surely my hon. Friend would agree that HS2 is not the only possible means by which to achieve that regeneration. We have to look at what gives us the best value for money.

Up to 70% of the new jobs created by HS2 will benefit London, where Old Oak Common is believed to be the best location for regeneration. I am sure that many hon. Members across the House do not feel that regeneration benefits to London represent good value for money. In fact, research on capital expenditure in the wider economy suggests that the cost of creating one job in the first phase is about four times the cost of capital expenditure in the wider economy. Again, I urge the Department for Transport to consider whether the project will create jobs. Would it be better to spend the money elsewhere and get four times the number of jobs in the wider economy?

Planning Control

Debate between Craig Whittaker and Andrea Leadsom

Wednesday 12th January 2011 Westminster Hall

[Andrea Leadsom]

My hon. Friend makes a very good point. Returning to my question to the Minister, I am unclear about how big a part wind power can play in providing for our 21st-century energy needs. Denmark, which is Europe’s leading contributor to onshore wind farm development, and France have both changed their policies on wind farms, with Denmark stopping all further onshore wind developments. Recent press has highlighted how during cold weather, the efficiency of wind turbines can drop to negligible levels. During the latest cold snap, wind turbines that normally produce up to 5% of Britain's energy achieved only a miserable 0.2% at a time of greatest need.

Three picturesque villages in my constituency—Helmdon, Sulgrave and Greatworth—are dealing with the prospect of a wind farm in the middle of the three villages. The residents are open-minded, and many have said that they would accept the proposal if they could be convinced that it offers the right solution. However, Northamptonshire is one of the least windy counties in the country, and local calculations suggest that the output of the proposed turbines may be as little as 19% of capacity. It is worrying that the generosity of taxpayer-funded renewables obligation certificates means that even with so little energy production, the project is still worth while for the developers.

I have read the Localism Bill in detail, and it seems that the new neighbourhood plans will include within its scope any generating plants of up to 50 MW capacity.

[Craig Whittaker (Calder Valley) (Con)]

I congratulate my hon. Friend on securing this debate, Will the Minister respond to an ambiguity about the 50 MW output and neighbourhood plans? In Calder Valley, a plan is going through in Crook Hill, which is half in the Calder valley and half in Rochdale. If the two were combined, that would take the output well over the 50 MW limit for neighbourhood plans to have an input. Will the Minister clarify the position in that case, because many constituencies, such as Calder Valley, which have moorland around them, butt up to many other local authorities and local communities?

[Andrea Leadsom]

That is a good question, and it would be helpful to have a response from the Minister. Having read the Localism Bill in some detail, it seems that the new neighbourhood plans will include any generating plants of up to 50 MW capacity within their scope. I understand that that means that a community will be able to decide whether to include a wind farm of up to that size within its neighbourhood plan. I would be grateful for confirmation from my hon. Friend that that understanding is correct. I also understand that applications for generating plants of greater than 50 MW will be subject to determination by the Secretary of State as being nationally important. I would also appreciate confirmation that that is correct.

Finally, what will be the appeal process for wind farms under the new legislation?

The Bill is not clear—not to me anyway. Specifically, I and my constituents would like to know whether wind farms that are turned down locally could in future be approved on appeal just as easily as has been shown to be the case recently. What reassurance can the Minister give me that the views of local communities really will count in future?

In conclusion, I welcome the Localism Bill, and I am grateful to my hon. Friend the Minister for the support that he has given to my constituents, both in visiting us and in responding to questions. Northamptonshire was under siege by the previous Government¸ but I have great hopes of a bright future for my home county, where local communities will have a far greater say on planning developments and the focus will be on providing for local needs, not national diktat.