Latest Public Sector News

16.05.13

£3.3bn funding gap for HS2 – NAO

The NAO has identified an estimated £3.3bn funding gap in the costs for HS2 over four years from 2017/18 – 2020/21. The Government has yet to decide how to fill this gap, a new review warns.

The Department for Transport said the report was overly simplistic.

The NAO review into the DfT’s planning for the project found that the department has “poorly articulated” the strategic need for a transformation in rail capacity and how the project will generate regional economic growth.

The benefit:cost ratio for phase 1 of HS2 has twice contained errors, the review highlighted, and the DfT should update the data underpinning some key assumptions in the ratio.

The department should also carry out research into how business travellers use their time on trains, to make clear the relationship between the strategic reasons for HS2 and journey-time savings.

Amyas Morse, head of the National Audit Office, said: “It’s too early in the High Speed 2 programme to conclude on the likelihood of its achieving value for money. Our concern at this point is the lack of clarity around the Department’s objectives.

“The strategic case for the network should be better developed at this stage of the programme. It is intended to demonstrate the need for the line but so far presents limited evidence on forecast passenger demand and expected capacity shortages on existing lines. It is also unclear how High Speed 2 will transform regional economies by delivering jobs and growth.

“The Department is trying against a challenging timetable to strengthen its evidence and analysis, which at present provide a weak foundation for securing and demonstrating success in the programme in future.”

Margaret Hodge MP, chair of the Committee of Public Accounts added: “HS2 is one of the country’s largest infrastructure projects, with plans to invest huge sums of taxpayers’ money, up to £17.3bn for phase one and around £33bn if phase two goes ahead.

The Department has produced a business case that is clearly not up to scratch and shows no signs of having learnt the lessons from HS1, which the Committee reported on last year. Some of their assumptions are just ludicrous.

“There is virtually no evidence in this business case to support claims that HS2 will deliver regional economic growth, one of the key aims and justifications for this project. We have been told that it will deliver around 100,000 new jobs but there is no evidence that all these jobs would not have been created anyway.

“The Department has also set an extremely ambitious timetable for the project, with no room for mistakes. Past experience does not fill us with confidence in this optimism. Unless the Department gets its act together, HS2 will not deliver all intended benefits for travellers and the regions, and it will not deliver value for the taxpayer.”

Tell us what you think – have your say below, or email us directly at opinion@publicsectorexecutive.com

Image c. DfT

Comments

There are no comments. Why not be the first?

Add your comment

 

related

public sector executive tv

more videos >

last word

The importance of openness after Grenfell

The importance of openness after Grenfell

Following the recent Grenfell Tower tragedy, Lord Porter, chairman of the LGA, argues that if the public are going to have faith in the safety testing process then everything must be out in the open more > more last word articles >

public sector focus

View all News

comment

Peter Kyle MP: It’s time to say thank you this Public Service Day

21/06/2019Peter Kyle MP: It’s time to say thank you this Public Service Day

Taking time to say thank you is one of the hidden pillars of a society. Bei... more >
How community-led initiatives can help save the housing shortage

19/06/2019How community-led initiatives can help save the housing shortage

Tom Chance, director at the National Community Land Trust Network, argues t... more >

interviews

Artificial intelligence: the devil is in the data

17/12/2018Artificial intelligence: the devil is in the data

It’s no secret that the public sector and its service providers need ... more >

the raven's daily blog

Northern Powerhouse Partner aims to connect the North once again

02/09/2019Northern Powerhouse Partner aims to connect the North once again

In February this year, official Northern Powerhouse Partner, Cognitive Publishing, delivered EvoNorth 2019.  The two day event was designed to amplify and highlight futur... more >
read more blog posts from 'the raven' >

editor's comment

25/10/2017Take a moment to celebrate

Devolution, restructuring and widespread service reform: from a journalist’s perspective, it’s never been a more exciting time to report on the public sector. That’s why I could not be more thrilled to be taking over the reins at PSE at this key juncture. There could not be a feature that more perfectly encapsulates this feeling of imminent change than the article James Palmer, mayor of Cambridgeshire and Peterborough, has penned for us on p28. In it, he highlights... read more >