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HS2 essential for redistributing wealth in the UK, says infrastructure expert

Although there is a danger that HS2 will make London even more attractive, the new high speed rail line is essential to help cities such as Manchester and Birmingham further grow.

Speaking at a guest lecture at Alliance MBS, Ian Reeves CBE, Visiting Professor in Infrastructure, Investment and Construction, said the debate over HS2 had not been helped by people politicising the scheme rather than looking at its core objectives.

"HS2 was never about speed, it was first and foremost about capacity," he said. "By mis-selling the objective we tarnish the investment. We have to be very careful with public opinion today that we carry public opinion with us, and this is equally true with the 89 megaprojects in the National Infrastructure Programme, each of which exceed £1bn.

"But I believe HS2 is an essential investment in redistributing wealth in this country. If Manchester does the things it is trying to do, along with Birmingham, they will become growth centres themselves and HS2 will help redistribute economic activity more widely."

Long-term investment

Reeves said long-term investment in infrastructure was essential to productivity, welfare and wellbeing in any country.

"It is easy to see in a developing country that poor, inadequate infrastructure is contributing to poverty. But in developed countries we tend to think it's all been done and it's not so obvious to see. Judged by fellow members of the G7 group of economies the UK has consistently underinvested in long-term infrastructure for at least the last 30 years, and a consequence of that is our economic productivity and welfare is behind other G7 countries."

Why have governments underinvested in infrastructure? "We have short-term political cycles and that is at the heart of the problem, but it is not the only problem," he added.

"Another is that if you look at the Green Book, which is the Treasury's guidance on any use of public money, it is horrendously complicated and littered with caveats. Its central basis is a Cost Benefit Analysis (CBA) model which is essentially a static model which assumes that the economy would not be affected in any dynamic sense. Yet infrastructure is completely the opposite to that. As such the CBA is very poor at capturing the additionality of dynamic impacts of infrastructure investment."

National Infrastructure Commission

Reeves said he was given hope by the National Infrastructure Commission, a recently formed body which provides the government with impartial, expert advice on major long-term infrastructure challenges. Last summer the Commission issued its first infrastructure assessment which he says "lays bare" what needs to be done.

The report said that the UK "must take decisive action to have world-leading infrastructure" but said that too often the delivery of the UK's major infrastructure projects has been "slow and uncertain", such that much of the country's infrastructure has not kept pace with population growth, demand and advances in technology. Among its core proposals is £43bn of stable long-term transport funding for regional cities.

Added Reeves: "I do think there is an acknowledgement in London, Manchester and other areas, of what needs to be done. I just hope that all of the recommendations of the assessment will be taken on board, including setting aside and delegating to cities large budgets for them to spend locally on achieving it. If we fudge the issue we would have missed another opportunity."


Given the environmental pressures on cities, Reeves said the benefits of creating an efficient multi-modal transport network were now clear. "What every city understands now is that if you can have a transport system which is multi-modal, and where you can move seamlessly from one mode of transport to another, that you don't have to worry about whether it's going to be congested, and don't have to worry about frequency. You can turn up, get on and move. You get a magnetic effect and suck people in. You become attractive rather than be unattractive as many of our cities are today."

Value proposition

Nuno Gil, Professor of New Infrastructure Development at Alliance MBS, organised the lecture which was part of a seminar series hosted by the School's Infrastructure Development Research Group which addresses the economic and social value of infrastructure.

He added that to fully understand the value proposition fuelling HS2 we need to appreciate the strategic choice by which government enfranchised, into the planning process, the local authorities of the cities on the route.

"Since then, the goal has evolved from just being a railway into a catalyst of urban regeneration with the potential to radically transform the socio-economic landscape of the UK. This goal change has required a relaxation of the budget, but has increased the social value of HS2."