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Sell Network Rail and scrap HS2?

Controversial reforms are needed to Britain’s rail network, including selling nearly half of Network Rail and an end to the HS2 project, according to a right-wing think-tank.

The new paper from the Adam Smith Institute shows the increasingly radical solutions to the rail industry’s problems being floated.

Network Rail has overspent by £1.7bn so far in CP5, and is considering selling off 18 major stations to meet a debt which is rapidly reaching £50bn, leading to fears from campaigners that it will be privatised.

The Adam Smith Institute said that the government should sell a 49.9% stake in Network Rail at a value of £8bn, although this might involve writing off some of its debts. This would allow it to operate as a financial company and expand its involvement in rail services to overseas. However, this feels a little too extreme.

The paper says: “On the financial front, there is a powerful case for selling part - or all - of Network Rail, despite the infamous collapse of its predecessor, Railtrack, back in 2001.”

It also argues that HS2 is over-budget and will not deliver significantly increased capacity or reduced journey times. The high-speed rail project is currently under review from civil service head Sir Jeremy Heywood to try to keep it within its £55bn budget. The Institute said resources should be re-directed towards modernising services in the north instead, especially around Manchester. This suggestion may be welcomed by some, but definitely not all.

Unsurprisingly, the paper says that the existing rail franchising system should remain, but with more vigorous financial modelling to avoid failures such as the collapse of a deal for FirstGroup to take over the West Coast Main Line in 2012. It also backs calls for more open access operations, especially to Sunderland, Hull and York.

However, a spokesperson for the Rail Delivery Group rejected the paper’s proposals, saying “The report’s comments on HS2 are somewhat surprising given HS2’s crucial role in ensuring the country has the railway it needs in the long term.”

They added: “However we organise ourselves in the railway, to transform the experience of customers we need teams that are managed effectively, working together towards the same objectives, and with access to finance for much needed investment.”

Whether you agree or disagree with the Institute’s report and recommendations, it is interesting to see how extreme the views are becoming on these controversial topics.

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Gary   09/09/2016 at 12:15

Let's face it, HS2 is a pet project of our politicians. It doesn't serve much of our nation and the business case is very suspect. They will do whatever it takes to protect this project whilst other areas of our infrastructure are allowed to suffer from years of underinvestment. £55Bn is a massive amount of public money.

Graham Nalty   09/09/2016 at 13:03

Gary seems to have hit the nail on the head. We need rail investment in the North, not only linking the major cities of Leeds, Bradford, Sheffield, Manchester, Stoke, Liverpool, Hull, Middlesbrough and Newcastle, but also improving the local lines serving them. The proposed parkway stations at Crewe, Manchester airport and Toton will only suck investment away from the cities they are meant to serve. But we do need better links to Heathrow airport and to the channel tunnel. Unfortunately HS2 offers far too little benefit for its cost.

Martin T   09/09/2016 at 13:40

"The new paper from the Adam Smith Institute" Well, I was pretty sure it wasn't from Jeremy Corbyn!

John Grant   09/09/2016 at 14:54

I fear the HS2 juggernaut is unstoppable, as Gary implies. I suggested to them they should build it as 4 tracks, with slow trains stopping at all the places where people have been protesting and a cross-platfom change to fast trains at major towns, but they said that would be too expensive.

Chris M   10/09/2016 at 03:34

I though David Serpell had passed away? Maybe his ghost has written this claptrap? Usual stuff from a right-wing think tank, they tend to be bitterly opposed to any kind of public transport investment and consider all government infrastructure projects to be wrong - unless they are roads, in which case everything is hunky-dory!. Gary, you say HS2 doesn't serve many people? You what? Add up the population of the urban areas of Greater London, Birmingham, Manchester, Liverpool, Sheffield, East Midlands (Derby/Nottingham), Leeds, York, Newcastle etc. The population figure is huge!HS2 will serve all of these and many more with frequent direct trains - it is impossible to serve so many UK large cities in a more efficient way than HS2 is designed to. And it can be extended in stages to Scotland if the political will exists. It is exactly what the UK needs to triple the capacity of our Victorian era railway lines and build economic prosperity. John Grant - no, there is absolutely need to four-track HS2. Two tracks from London to Birmingham Interchange allow eighteen trains in each direction with either 550 or 1100 seats - it will be an amazing people mover. The tracks tend to avoid passing near to big towns as far as possible and there is no sensible way to stop a 205mph train without slowing down several following trains. Instead HS2 frees up space on the existing lines, so frequency and seats can be increased on them instead.

Chris M   10/09/2016 at 03:45

"It also argues that HS2 is over-budget and will not deliver significantly increased capacity or reduced journey times" The eventual cost cannot of course be stated with certainty, but it is clear it will provide many more seats and cut huge amounts of time off the current inter-city schedules - typically 60 minutes to Manchester, over 50 minutes to Leeds, 40 minutes to Liverpool and around 35 minutes to Birmingham. I can only conclude that the hapless twonk who wrote this abject nonsense came straight from a remedial maths class! If Adam Smith were alive today I don't think he would be too happy being associated with people who manifestly struggle with basic figures!

Lee   10/09/2016 at 11:12

25 years of pollution environmental destruction noise (which the satanists love) and billions to line thier pockets is all this evil project is about,nothing else so let's not kid ourselves.

Lee   10/09/2016 at 11:13

25 years of pollution environmental destruction noise (which the satanists love) and billions to line thier pockets is all this evil project is about,nothing else so let's not kid ourselves.

John   10/09/2016 at 12:04

There's much common sense in what has already been posted about HS2 being a politicians masturbatory fantasy with a seriously dodgy business case. But to me the blindingly obvious failure is that of no plan to link with HS1 and, who the heck wants Euston anyway - too small and far too expensive. Re: NR privatisation? Well, the Government is seriously tempted and there are certain politicians with an eye on undisclosed business interests who are salivating at the opportunity to grab public assets on the cheap and enrich their portfolios - Marples et al all over again! Break it up into competitive elements by all means but maintain it in the public ownership for the forseeable future and well it is all well established then think again - but not on some "get much richer even quicker" scheme for the city types and friends!

John Burns   10/09/2016 at 17:41

John, correct. This is what in economic terms is called 'economic rent seeking'. Private organisations appropriating commonly created wealth. No economist has given HS2 a positive rating. Most have given it negative ratings. KPMG, hired by HS2 Ltd, stated it will harm the economy of Liverpool. HS2: - Only serves 'FOUR' cities centre to centre. - The Manchester airport station is a mile from the terminal. - The Birmingham station is about a mile from New St where all the local and regional connections are. - It is not near the terminal at Birmingham airport either. - It does not connect to the Continent. - It does not run into any of London's four airports. - It left Liverpool off the direct network; the only major city left off HS2. This is ludicrous. It is bound to fail and become a white elephant. To make it work much more money will need to be poured into it to expand it properly and make it a 'mesh', rather than a wealth sluice into London. Manchester and Leeds should make it clear that they will not cooperative with HS2, until construction of a full HS2 is started. Otherwise they will be economic lacky's to London.

John Burns   10/09/2016 at 17:47

Graham Nalty, yes other local & regional rail is far more important. 40 years ago one third of Liverpool's metro was dropped. Work started and was was stopped. 4.5 miles of tunnel is under Liverpool and Birkenhead together with trackbeds, awaiting tracks and trains. The people of the Liverpool City Region are teed off it has not been completed. Yet HMG thinks it appropriate to engage in fantasy train sets which no economist has stated will create economic growth.

Moomo   16/09/2016 at 23:44

The weakest aspect of HS2 is the wildly optimistic assumption that it will be possible to run 18 trains per hour. IMHO it will be hard enough to run 12 TPH given the complexity of the high speed network, the varied service patterns, the absurdly high operating speed and the fact that many services will have to integrate with the legacy network. At 12 TPH, most of HS2s assumptions about "capacity" and "connectivity" fall apart, particularly now that Sheffield seems to require a dedicated service of its own; indeed I have a sneaking suspicion that Phase 2 may never get built for this reason alone; and if it does, either Brum, Manc and Leeds will have to make concessions (which will be painful given the gazillions being spent on their connections), or secondary destinations such as Liverpool, Preston, Sheffield, Stoke etc will lose their HS2 services altogether. Either way, there won't be anything like as much new capacity as has been suggested.

Jack Huang   31/10/2016 at 02:39

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