Lessons from HS2: when politicians agree, watch out

If there is moral to be drawn from HS2, it is that cosy parliamentary consensus is a truly terrible idea.

Nick Wood via Flickr

Has there ever been a public procurement disaster like HS2? It even makes Gordon Brown’s work-creation pair of aircraft carriers (sorry, nothing left in the budget to fill them up with planes) look like a rational decision. Like them, HS2 started going wrong long before any actual construction took place. There were pretty lines on the map, and as with the carriers, it was blindingly obvious to many of us even then that HS2 was going to be a money pit on an unprecedented scale.

The first red flag was the overwhelming consensus for the scheme in parliament. In October 2013, the bill was passed by 350 votes to 34, although the agreement that it was a jolly good idea started with Andrew Adonis years before. We are constantly being told by today’s administration that political consensus is the key to getting big projects done, because of the risk that the next government will scrap them. It’s not something anyone viewing this financial catastrophe should seriously contemplate.

Started by Labour under Gordon Brown, carried forward maniacally by David Cameron, there was never the political will to challenge it. We were told that the whole Y-shaped line from London to Manchester and Leeds could be built for £42.6bn (already up from £32.7bn by the time the vote was taken). Cameron described the project as "absolutely vital”.

This week’s fine words from Heidi Alexander about getting a grip on costs echoed those from previous transport secretaries, and is likely to have a similar impact on the depth of the money pit. There could be more non-financial horrors to come, too. Earlier this month, Stephen Cresswell, a cost analyst on the project who was fired in 2022 for saying the estimates had been fiddled to deceive politicians, won £320,000 in compensation.

Nobody can say how much the shrunken bit of HS will cost, but the last official guess of £80bn is little more than a basis for negotiation. The new CEO, Mark Wild, has admitted as much. The cost of signalling on big rail projects is always hugely underestimated, while building the trains which will rush up and down this short railway (at lower speeds) is extra. Only government manipulation of the fare structure will encourage passengers to go out to a London suburb to catch a (fairly) high speed train to Birmingham, rather than going from Euston. The time saved for travellers to Liverpool or Manchester will disappear in the need to make connections.

Big infrastructure projects are all the rage under today’s Labour, albeit only on paper. The final bill for the Lower Thames Crossing, if it gets built, may be worth while, but probably only on a 50-year payback. The construction of Sizewell nuclear power station, effectively taken over by the government in the Financial Review after every other source of capital fled, has no official figure for its cost, despite it being years in planning.

Why are we so useless at grands projets? Safeguards for tiny minorities, addiction to process, and a polyannish view of the likely cost all trickle sand into the machine, while the complexity of our laws, even those passed in good faith, provide endless scope for delay, confusion and paydays for lawyers. If there is a moral to be drawn from HS2, it is that cosy parliamentary consensus is a truly terrible idea. Oh, and the next one coming down the track? The Climate Change Act. Only five MPs voted against this ticking time-bomb of an act.