Critics of the scheme believe the new calculation could result in an official assessment showing for the first time that the scheme offers “poor” value-for-money, after the last assessment, in 2020, concluded that it had dropped from “medium” to “low” value for the expected taxpayer spend of up to £100 billion.
Last week, Professor Andrew McNaughton, HS2’s former technical director, said the West Midlands-Leeds leg had been the “core” of the plan for the line, which is due to stretch from London to Birmingham and the North.
Government departments use benefit-cost ratios (BCRs) to assess the value for money of individual schemes. The BCR measures how much benefit can be expected for each pound spent on a project, with less than £1 categorised as “poor” value for money, between £1 and £1.50 as “low”, and between £2 and £4 as “high”.
An assessment published in 2020, following a review of the project commissioned by Mr Johnson, produced a BCR of 1.2, or 1.5 when taking into account the Government’s estimated “wider economic impacts” of the line.
Lord Macpherson said: “When the Government chose to go ahead with HS2 there was plenty of cost-benefit analysis. It is surprising that they haven’t done it.”
‘White elephant missing a leg’
The Government’s Integrated Rail Plan, published on November 18, confirmed that the eastern leg of HS2, linking the West Midlands and Leeds, had effectively been scrapped, while plans for a new line between Manchester and Leeds – a key plank of Northern Powerhouse Rail – have also been abandoned.
The announcement sparked a mixed response among Mr Johnson’s MPs, with fury expressed by a series of backbenchers over the decision to axe the eastern leg of the HS2 route. Other senior Conservatives have been calling for the scheme to be scrapped altogether, due to spiralling costs and what they see as a weak business case for the line, which the Prime Minister has said would cost more than £100 billion.
Speaking at the time of the announcement, Sir Edward Leigh, the Conservative MP for Gainsborough and former chairman of the public accounts committee, said: “HS2 was always a white elephant, but as far as the east coast is now concerned it is a white elephant missing a leg. We were promised it would relieve congestion on the east coast main line because it was going to go to Leeds.”
A Department for Transport spokesman said: “It is untrue that benefit cost ratio analysis was not undertaken. Our £96 billion Integrated Rail Plan was informed by detailed economic and value for money analysis including benefit cost ratios. As individual schemes are taken forward, further cost-benefit analysis will be completed to inform future decisions. This is standard with a project at this stage of development and given the study to be carried out on how to take HS2 services to Leeds.”