So if the business case that is supposed to demonstrate that HS2 is in the national interest is flawed, what about the impact our local region? There are many, particularly in Birmingham, who argue that a faster rail link between Birmingham and London will be good for jobs and growth in the regional economy. Unfortunately, I believe this is based more on hope than on a hard headed analysis of the evidence.
I believe the impact on the region and the sub region, particularly Coventry and Warwickshire, will be negative.
Firstly, the impact assessments produced by HS2 Ltd themselves clearly demonstrate that one of the costs of HS2 will be a slower and less frequent train service for the surrounding towns and cities. Coventry, for example, will see the current direct fast rail service to London slashed from three an hour to one an hour, and that remaining service is likely to be around ten minutes slower. This hollowing out of services for towns and cities in between high speed rail stations has been called the 'tunnel effect', and will be disastrous for the local economy in Coventry and Warwickshire.
Secondly, there is growing evidence from studies of existing high speed rail services in other countries that, far from pushing economic growth out from the centre to the regions, high speed rail networks can have the opposite effect. They can suck economic activity from the regions in towards the centre. There is a real danger of economic growth draining away from Birmingham and the surrounding region and towards London.
Research Institute of Applied Economics at the University of Barcelona has made a study of existing high speed rail networks in Japan, France, Germany, Spain and Italy. Their findings should cause policy makers here in the UK to sit up and take notice.
The study suggested that smaller cities linked to larger cities by high speed rail lines sometimes suffered from a negative agglomeration effect. This can take several forms. For example, while there is evidence that a high speed rail link from a capital city such as London to a regional city will increase the number of visitors to the smaller city, fewer of those visitors will stay the night.
"Train passengers staying at least one night at their destination fell from 74% to 46%"
(Research Institute of Applied Economics, University of Barcelona).
What impact would this have on our region's vital tourist industry, particularly the hotel and restaurant trade?
The report is very clear about the risks to smaller cities such as Birmingham, when linked to a larger city such as London by a high speed rail route:
"It is consistently reported that HSR does not generate any new activities nor does it attract new firms and investment, but rather it helps to consolidate and promote on-going processes as well as to facilitate intra-organizational journeys for those firms and institutions for whom mobility is essential.
"In fact, for regions and cities whose economic conditions compare unfavorably with those of their neighbors, a connection to the HST line may even result in economic activities being drained away and an overall negative impact (Givoni, 2006; Van den Berg and Pol 1998; Thompson 1995). Medium size cities may well be the ones to suffer most from the economic attraction of the more dynamic, bigger cities. Indeed, Haynes (1997) points out that growth is sometimes at the expense of other centers of concentration. Several reports describe the centralization of activities in big nodes, especially in the services sector."
(Research Institute of Applied Economics, University of Barcelona).
The report's conclusion has this very clear and very sobering warning:
"Finally, the economic impacts of HSR are somewhat limited. The largest cities in the network might receive limited gains, but this is not the case for intermediate cities, which might see economic activities being drained away and suffer an overall negative impact."
(Research Institute of Applied Economics, University of Barcelona).
So here in the West Midlands, and particularly Coventry and Warwickshire, we need to look very carefully at the potential negative impact that HS2 could have on our regional economy. Thankfully, most local councils appear to have recognised this and have come out in public against HS2 on a cross political Party basis (North Warwickshire Borough Council, Coventry City Council and Warwickshire County Council for example).
I recommend reading the University of Barcelona's report, which can be found here:
4. High Speed Rail Report, Research Institute of Applied Economics, University of Barcelona.
