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David Davis MP writes in The Sunday Telegraph on how the next PM must recognise HS2 for the wasteful vanity project it really is

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As published in The Sunday Telegraph:

The past year has seen a number of hammer blows to the public’s perception of HS2. Despite this, last week both George Osborne and Amber Rudd threw their support behind pushing ahead with the project. Rudd even went so far as to say that any new PM must fully commit to HS2, saying it was a “very good example of thinking long term”. Turning that into non-emotive language: they must believe the return on investment will be beneficial to the UK. Really?

In 2010, the original forecast cost of HS2 was £32.7 billion. Since then we have seen costs rise in 2011, 2012, 2013 and 2014. The official price tag is now a staggering £56 billion.

From my five years as Chairman of the Public Accounts Committee, and after seeing costs overrun on project after project, this is hardly surprising. Big government schemes invariably massively overspend – one economist characterised this as the “iron law of megaprojects: over budget, over time, over and over again”.

I recently challenged the Government in a Parliamentary Question to guarantee HS2 would be delivered on time and on budget. I received a non-answer. No minister is going to be daft enough to actually put their own name to these numbers.

Frankly I would be very surprised if we got change from £100 billion, and would be entirely unsurprised if the final cost shot over the £200 billion mark. That’s an astonishing sum of money. But when talking about such astronomically large figures, it is easy to lose sight of what it actually means.

So, let’s put £100 billion into context. A brand-new specialist hospital can be built for £100 million. So we would get 1,000 new hospitals for the likely cost of HS2. Or to look at it another way, the average train in the UK is approaching 20 years old. We could replace every single one four times over.

Independent reports suggest HS2 does not represent value for money. The Government’s own benefit-cost ratio shows it will not deliver anywhere near the same value for money as other infrastructure projects that have been given the go-ahead in recent times. Moreover, similar high-speed rail projects around the world have fallen far short of their expected returns.

HS2’s own appraisal of the project confirms 40 per cent of the passenger benefits will accrue to London. That is almost certainly an underestimate. Rather than bring growth to the provinces, HS2 will do the opposite, sucking prosperity out of the North and into London.

As the justifications for HS2 have been knocked down one by one, the Government has shifted the goalposts. In 2010, the justification was speed. The Government has now pivoted to focus on the supposed improvements to capacity and connectivity. But HS2 will satisfy neither. By the time the route is scheduled to open, the technology underpinning it will have been superseded, while the vast majority of congestion occurs over short distances HS2 will not cater for.

But as is often the case with vanity projects, the Government has become obsessed with pushing ahead, blind to the objections raised against HS2.

Even if you support investing £50 billion in infrastructure to encourage growth – a perfectly respectable and laudable policy – there are much smarter ways to do so than HS2. We should be creating regional economic centres by linking up major cities and investing in local infrastructure. There are dozens of potential local rail and other transport projects that would remove bottlenecks, meet real demand now and give the taxpayer a return that they might enjoy in this lifetime.

Beyond transport, with the money saved the Government could support thousands of small businesses by rolling out a full fibre optic network across the UK at a fraction of the cost. Or we could make a significant dent in the housing crisis by funding the development of garden villages.

Last week, Amber Rudd said HS2 is a “litmus test” for whether any new prime minister is serious about the economy. It is far from that. Frankly, it is a litmus test for whether someone is competent on the economy.

The real benchmark for the successful candidate at the coming leadership contest will be whether they have the imagination and foresight to see what is best for the long-term prosperity of the UK. Not a narrow-minded focus on what is nothing more than a vanity white elephant, but a serious grip on what the future needs of a fast-growing post-Brexit economy really are.