High Speed Rail 2 is a case study on how the Westminster parties that lead the No campaign don’t act in Scotland’s best interests.
High Speed Rail 2 (HS2) is a white elephant that Business for Scotland opposed from day one
. We have consistently criticised this unsustainable, unaffordable and economically nonsensical project and in doing so predicted it would damage the economy of Scotland, in particular Aberdeen and Dundee.
The Westminster Government says one thing in public and another in private.
Information released this week under a Freedom of Information request by BBC2’s Newsnight programme shows the Westminster Government have been misleading Scotland and several English regions on the project’s economic impact. London’s Department for Transport previously pointed to selective extracts of a study by global accountancy firm KPMG – which stated the UK economy would gain by £15 billion a year – and the greatest benefit would fall to Greater London (£2.8bn) and the West Midlands (£1.5bn).
However, the full report has now been released against Westminster’s wishes and it makes clear that other regions will lose out substantially. The report that the No Campaign wanted to keep secret clearly states that Aberdeen’s economy will lose out as a direct result of HS2 to the tune of £220m a year and Dundee by a further £96m – not as one off costs but every year ongoing. This means that Scots will lose their jobs as a direct result of the contraction in the North East economy resulting from this project.
This is entirely unacceptable and offers documented proof that the economic plans made in Westminster are tailored almost entirely to London and the South East often against Scotland’s competitive interests.
The estimated cost of the project rose from an initial guess by Westminster of £25bn to the latest admission of £40bn. The well respected The Institute of Economic Affairs (IEA) predicts the eventual cost will be upwards of £80bn. As part of the Westminster system, Scotland’s people represent 8.4% of the country’s population but contributed 9.9% of the UK’s taxation revenues in 2011/12. So we are paying at least £7.92bn out of your taxes to a project that will rip at least £316 million GDP from the economy of the East coast per year – How does that make us better together?
HS2 was approved by the No Campaign’s Alistair Darling in his capacity as Chancellor of the Exchequer. Business for Scotland has lead the criticism of HS2 with clear economic rationale and so Alistair Darling realised he was vulnerable to fair criticism on his support of this indefensible project. In a desperate, cynical but failed attempt to distance himself from a project he approved he has recently joined the list of those calling for it to be scrapped. Maybe it would have been better if he added up the numbers properly and protected Scotland’s interests in the first place. He was either complicit in putting London first or asleep at the wheel when the economic analysis was being compiled, or both. As a well respected Scottish businessman made clear in a speech last weekend, Alistair Darling is becoming known as the No Campaign’s Weapon of Maths Destruction!
Reaction to the news
James Bream, Policy Director of Aberdeen’s Chamber of Commerce stated “it was really disappointing that such a huge number was left out of the original economic impact report”.
The Department for Transport issued a statement saying “These figures show that the new North/South railway is vital to rebalance our economy and it boosts the north overall more than the south.” For the record, from where Westminster civil servants sit in Whitehall, the North is Manchester and Leeds. From an office in Aberdeen or Dundee, Manchester is a long way South!
And finally, the chief executive of HS2 Ltd Alison Munro didn’t exactly give a robust defence when she described the newly released figures as “unsurprising”. Well at least Hs2 and Business for Scotland agree on something.
We now have clear independent evidence that HS2 like so many other projects aimed at boosting London and the South East of England is not only puling Scottish tax revenues but also dragging economic activity away from Scotland’s regions. Westminster tried to hide the damage to Scotland’s economy proving they say one thing in public and another in private.
The economic impact of HS2 on the Scottish east coast alone is enough to merit cancelation. Of course, if Scottish interests meant anything to the Westminster parties and indeed Alistair Darling in the No Campaign, the project would never have got the go ahead. If Hs2 is canceled, it will be because areas such as Essex, Cambridge and Bristol will also lose out, and they have political clout in the Westminster system. Our only prospect of stopping these kinds of damaging decisions from London is to take control of our own wealth and invest in Scotland through the powers of independence.
Update: Victory – Since the UK government has now been forced to admit that Hs2 will never reach Scotland. The civil servants who compile the GERS report have confirmed to Business for Scotland that they will now refuse to accept any contributions to the cost of Hs2 on Scotland’s behalf.