High Speed 2

Steve Baker Excerpts

Thursday 13th October 2011 Commons Chamber

[Esther McVey]

I do not disagree at all. I believe that we need greater connectivity across the board. Equally, this project is not starting until 2017 and will go on for two decades. I would like that to be brought forward, not just for the north-west but for the south.

I want to look at where Merseyside needs to develop and what development we are stopping. Official figures for 2009 recorded that 48 million UK day visitors went to Liverpool. It was the sixth most popular destination in the UK. The number of visitors is projected to grow to 55 million by 2013. With overcapacity on the trains, that will not happen. This is not just about speed; it is fundamentally about capacity.

There is also the Liverpool super-port freight development, which is being led by the private investors, Peel. It is set to develop a £300 million in-river berth, which will increase port capacity from 700,000 containers a year to 3 million, creating more than 4,000 new jobs. We need connectivity, warehouse storage and logistics. We want to grow all of those things. This is about rebalancing the economy. Of course there will be jobs in building the infrastructure, but there will also be key jobs in freight and movement. Liverpool should be positioning itself as the port of the north. I have always said that without our ports—whether the cruise terminal or the freight port—we are only a 180° city or half a city. We need to open up links to our waterways to ensure that we are a 360° city.

[Steve Baker (Wycombe) (Con)]

I just make the tiny point that HS2 will not carry freight, because freight would make the trains too heavy to stop from high speeds. I just wanted to check that my hon. Friend was aware of that.

[Esther McVey]

No, there will be increased freight capacity, and that is key. There has been a 56% increase in the amount of freight over the past eight years. We have to accommodate that and develop the capacity that we have.

In conclusion, High Speed 2 is vital, as are the northern hub, the connection with Liverpool, our ports and opening up the UK as a whole. There is a financial argument, which people have made. I have given the latest statistics from KPMG. High Speed 2 is about uniting the country, and about spreading wealth and opportunity to areas that desperately need them. My only concern is that it should happen sooner rather than later.

--- Later in debate ---

[Steve Baker (Wycombe) (Con)]

I congratulate my hon. Friend the Member for South Northamptonshire (Andrea Leadsom) on securing the first debate on high-speed rail to be held in the Chamber. This is, however, the fourth debate that we have had on the subject since the election. We debated it in Westminster Hall on 23 November, 31 March and 13 July, so we have discussed it every four months or so. I notice that the period between debates is becoming ever shorter, so by the time HS2 delivers any value, we might be debating it every day.

Contrary to certain assumptions, I am the only Buckinghamshire MP whose constituency is not affected by the high-speed rail proposal. I know that your constituency is affected by it, Mr Speaker, and that your constituents have very strong views and that you submitted a substantial response to the consultation. The Secretary of State for Wales, my right hon. Friend the Member for Chesham and Amersham (Mrs Gillan), responded robustly to the consultation on behalf of her constituents, delivering seven files of objections and evidence against HS2, which will cut a deep scar through the middle of the area of outstanding natural beauty in which her constituency sits. The Minister for Europe, my right hon. Friend the Member for Aylesbury (Mr Lidington), and the Attorney-General, my right hon. and learned Friend the Member for Beaconsfield (Mr Grieve), were present earlier, and I know that their constituents are implacably opposed to HS2. Many other members of the Government also have objections, including the Lord Commissioner of Her Majesty's Treasury, my hon. Friend the Member for Lichfield (Michael Fabricant), who also has strong views.

Although my constituents are not directly affected, they oppose HS2 on a number of grounds, but before I go on to explain my opposition, I wish to welcome the Government’s noble intentions. Whether in seeking the rejuvenation of the economy, the revitalisation of the north or the protection of the environment, or in trying to attract international inward investment, their intentions are indeed noble, but I regret to say that I do not support the means by which they seek to meet those ends.

The Secretary of State reflected on capacity, carbon and international competition in his evidence to the Transport Committee. On the question of the economics, as we have already learned in this debate, it is possible to refer to the titles and authors of reports both for and against the proposal. I am afraid that for every economist who comes down on one side of the debate, there will always be another economist on the other side. The Economist magazine came out against HS2, and when I put that to the Secretary of State, he was quick to rebut it and explain that he was about to write a letter.

The truth is that this project is awash with entrepreneurial risk. It is impossible to get hold of any hard facts showing whether it is a good idea. There is certainly an economic case, but I am afraid that it is ethereal: the moment we grasp it, it seems to disappear.

[Paul Maynard]

My hon. Friend claims that there is no economic case, but does he recognise that there may be a strategic case?

[Steve Baker]

I enjoy serving on the Transport Committee with my hon. Friend, but I am not saying there is no economic case; rather, I am saying that we cannot nail down that case because of the entrepreneurial risk. In my view, when very large sums of capital are being allocated in an environment of entrepreneurial risk, entrepreneurs should bear that entrepreneurial risk.

I asked an international investor, “What do you think of HS2?” The answer was, “It would be wonderful to arrive fresh and relaxed in no time at all.” I then asked, “Would you invest in it?” The response now was, “That’s unfair. Of course I wouldn’t invest in it.” The market would not deliver high-speed rail, and that would be a market success, because to do so would be a misallocation of capital.

I put it to the Secretary of State that this project would socialise risk and privatise profit. He explained that that was to be expected, and we had to be realistic about it. I do not share that sense of “realism” on that point; I think that in reality this will be loss-making, in any commercial sense of the term. The whole point of loss is that it directs entrepreneurs to do something else with their capital, because if they are making a loss they are destroying value, not creating it.

I shall now deal with the carbon implications of this line. Something profound is going on in relation to carbon. The Secretary of State talked about the need to keep going until we were absolutely sure that we would decarbonise the roads. There is a vision at the heart of HS2 that we have not yet fully grasped. Given that I have 30 seconds available to me, and others wish to speak, I shall just refer to a letter that I sent shortly after I arrived in this place. I said that the Government could not afford high-speed rail, that they would not be able to afford it, that it would be a disaster if they did this—my basis for saying that was David Myddelton’s book “They Meant Well: Government Project Disasters” —and that the Government should not do it in any event, because it should be left to entrepreneurs. Nothing that I heard during the Select Committee on Transport inquiry has changed my mind.