Past Meetup

Economic Case For HS2 with Dr Richard Wellings (Institute of Economic Affairs)

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Hi All

I thought I would post this event here as it may be of interest to members of the group

When: 19:00 – 20:00 22 January 2014
Type: Talk + Q&A
Venue: Room 122, 43 Gordon Square, WC1H 0PD
Price: Free

The credibility of HS2 was undermined in June 2013 when the government revealed that its price tag had risen by £10bn, or 30%, to £42.6bn. The methodology of the government-commissioned KPMG report was subsequently questioned by LSE, Robert Peston and others.

The IEA, a free market think-tank, warns that the HS2 high-speed rail project could nearly double in cost to £80bn. Dr Wellings' case is that HS2 will be unbelievably costly to the taxpayer while delivering incredibly poor value for money.

The IEA report (see link below) also shows that the true long-term cost to the economy is even higher. HS2 will divert funds from high-return transport projects that could have delivered over £300bn of benefits.

Lobbying from local authorities for new links to HS2 stations and changes to the route to keep voters on side are likely to add around £30bn to the overall cost of the project. Estimates already put the project at £43bn and when the cost of new trains (£7.5bn) is added, as well as the additional £30bn, it takes the total close to £80bn – equivalent to £3,000 per household.

The additional £30bn in costs comes from lobbying that will mean:

> Additional infrastructure - for example, various new rail links, tram lines and road upgrades that will now be given the green light to cope with the additional pressure on infrastructure along the HS2 route.
> Design changes such as extra tunnelling to ‘buy off’ opposition. Critics have already claimed an extra £600m has been added to the project to keep the route away from towns in George Osborne’s constituency.
> Taxpayer-subsidised regeneration schemes around the new stations and in towns that are bypassed by the line.

Dr Richard Wellings was educated at Oxford and the London School of Economics, completing a PhD on transport and environmental policy at the latter in 2004. He joined the Institute in 2006 to work on the production of its monograph series and the journal, Economic Affairs. Richard is the author or editor of several papers, books and reports, including Towards Better Transport (Policy Exchange, 2008) and A Beginner’s Guide to Liberty (Adam Smith Institute, 2009). He is a Senior Fellow of the Cobden Centre, the Economic Policy Centre and the Libertarian Alliance.

Read the report here

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This is an event organised by Birkbeck Economics & Finance Society. Members of this group are welcome but I ask that you register via our site so that I have an idea of the final numbers (there is a limited number of seats).

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