Election result could push HS2 costs even higher

Westminster 133x102As a taxpayer-funded, big-government project that confiscates property and despoils swathes of countryside, High Speed 2 is anathema to genuine conservatives. Even within the modernised, rebranded Conservative Party there remains significant opposition.

This hasn’t been fully reflected in MPs’ voting record. Politicians often put their careers before principle. They won’t rebel against their own leaders unless there is a reasonable chance of it succeeding. HS2 was never likely to be stopped in Parliament while it was supported by Labour and the Liberal Democrats.

The slender government majority dramatically increases the power of backbench Tory MPs, however. As shown by the Major years of the 1990s, they now have the power to cause immense disruption.

This is likely to translate into ‘logrolling’ behaviour – i.e. the trading of favours. Backbenchers will be able to trade their support for vital legislation in return for concessions on policies that matter deeply to them.

MPs along the HS2 route will therefore have ample opportunity to exploit the government’s weakness (although whether they choose to do so will depend on the resolve of the individuals concerned).

Unless there is a major change in the policy of opposition parties, this would probably not jeopardise the project itself, at least initially. It would mean, though, that the MPs could have the whip hand when it came to demanding more spending on environmental mitigation in their constituencies.

Possible outcomes include longer tunnels, route changes and more generous compensation for affected residents – measures that would add significantly to the already bloated costs. While those close to the line would benefit, taxpayers would lose out. Concentrated interests would once again triumph over the wider population.

Another increase in the project’s budget would also present difficulties for governments already struggling with high public debt and sluggish economic growth, particularly given the huge off-balance-sheet costs of HS2. In the longer run, it could therefore make full or partial cancellation more likely.

 

See The High-Speed Gravy Train for more detailed analysis of the political economy of High Speed 2.

See the Economics of HS2 page for short introductions to the key aspects of the scheme.

Tour de France road closures could be avoided

The Tour de France comes to Britain this weekend, starting in Yorkshire then moving down to Cambridge and London.

Cycling fans will enjoy the spectacle, but the race will also cause considerable disruption and inconvenience to travellers and residents. Some people could almost be trapped in their homes by the road closures (for example, those with mobility problems who rely on cars and buses).

For large numbers who do not enjoy cycle racing there will be significant costs but few if any benefits. Yet, it seems that no compensation will be paid to those negatively affected.

To add insult to injury, taxpayers are being forced to spend millions hosting the race. And worse still, the BBC and the cycling lobby are already exploiting it to promote ill-conceived and economically damaging transport policies.

Such sporting events are telling examples of the state throwing its weight around and disregarding the costs imposed on individuals and businesses. As long as governments control the roads, politicians and officials will continue to impose their transport diktats on the wider population.

By contrast, roads under voluntary ownership would face strong incentives not to allow such disruption. On commercially operated roads, closures could mean fewer customers and less revenue. The interests of users and owners would be closely aligned and there would be a clear trade-off against potential revenues from any special event.

On local roads controlled by residents and businesses, small communities could decide for themselves whether to allow organisers to use their infrastructure, subject to pre-existing contractual rules on denial of access.