How bureaucrats torpedoed HS2 by assuming business travellers couldn't work on trains

The case for the High Speed 2 rail network has been severely damaged by assuming time on board a train is wasted for business travellers, a podcast has claimed.

Proponents of the £100billion scheme had initially hailed the economic benefit from the 250mph train journeys taking less time for those travelling for work.

But a crucial assumption was made that business people could not spend this time working on the train - despite many being able to easily do this while on board.

Now, a BBC podcast has looked at how the economic justification for building the line to be as fast as possible also led to ever-increasing construction costs.

Designers adjusted plans to ensure the railway would also be as straight as possible to avoid having to slow down by taking bends around woodland and villages. More sophisticated junctions and stronger slab track were also required for extra speed.

But the initial case for HS2 had been given as increasing capacity on the 700-mile West Coast Main Line which runs between London Euston and Glasgow.

The focus on speed therefore went against the primary aim of the project, which was intended to connect London with Manchester and Leeds via Birmingham.

The latest version of HS2 will only connect Old Oak Common in the Acton suburb of London with Birmingham after Rishi Sunak cancelled the northern leg in 2023.

The initial HS2 case was given as increasing capacity on the 700-mile West Coast Main Line

The Radio 4 podcast series 'Derailed: The Story of HS2' looked at how the business case for the line was based on outdated assumptions on the importance of speed.

This was based on business people needing to get somewhere as fast as possible, because of the working hours lost through travel – therefore increasing productivity.

But the widespread use of smartphones and wi-fi on trains means the construction of a straight line route is now less important, because work can be done on the move.

Andrew Meaney, partner at economics and finance consultancy Oxera, was asked by the Transport Select Committee in 2011 to analyse the business case for HS2.

Speaking about the 'benefit-cost ratio', which compares the economic benefits to its costs, he told the podcast: 'The way these benefits are calculated, a lot of it comes from bypass schemes.

'A driver of a car, they can't do anything with their time, if they're a plumber, they're between jobs, if they're a briefcase traveller, certainly at the time, you weren't making calls on your mobile phone.

'So that was really dead time. And the same logic was lifted and shifted onto railways.'

In HS2's business case, just under 30 per cent of the economic benefits were thought to come from journeys taking business travellers less time, which they could not spend working on the train – which appeared to be a sensible assessment in 2011.

Construction on an HS2 bridge in Birmingham near the project's Curzon Street site in August

HS2 workers complete digging of major tunnels between Birmingham and London in October

But just under a decade later, Mr Meaney was asked by the Government to review the business case for HS2 again on behalf of the Oakervee review, an independent report that was leaked in January 2020.

He said: 'We were expecting a Rolls Royce business case at that point. The features that we were expecting to be added hadn't been added.'

This included an updated assessment of the value of business travellers' time, given all the technological advancements over the decade.

But Mr Meaney said: 'The choices that were being modelled were fed in from a time before people could work as productively on trains as perhaps they can today.'

He agreed that this was before the widespread use of smartphones, wi-fi and laptops on board trains, adding that the lack of update was therefore 'very surprising'.

The Oakervee review, led by former HS2 Ltd chairman Douglas Oakervee, was commissioned by the Conservatives and aimed to determine whether and how HS2 should continue.

It found that HS2 could cost up to £106billion, but concluded 'on balance' that the project should carry on.

In February 2020, prime minister Boris Johnson gave HS2 the go-ahead despite 'exploded' costs, and the so-called funding envelope was reset.

Test designs for high-speed HS2 trains at manufacturer Alstom's Derby factory in October

Phase 1 between London and Birmingham was set at £44.6billion (at 2019 prices), with the estimated cost for the full network revised to a range of between £72billion to £98billion.

Labour had established HS2 Ltd to examine the case for a new high-speed rail line in January 2009, before a consultation on a London to Birmingham route with a Y-shaped section to Manchester and Leeds was published the following year by the Conservative-Liberal Democrat coalition government.

Transport Secretary Justine Greening then said in 2012 that the Government had decided to go ahead with the project, despite concerns over its cost and the environmental impact of construction.

But in November 2021, HS2's eastern leg between Leeds and the East Midlands was scrapped by the Government. And by March 2023, the Government said construction of the Birmingham to Crewe leg would be delayed by two years.

Work at Euston was also paused as costs ballooned to £4.8billion compared with an initial budget of £2.6billion – meaning services would start and stop at Old Oak Common until at least the 2040s.

And in October 2023, Mr Sunak announced at the Conservative Party conference in Manchester that he would scrap the northern leg of HS2 due to soaring costs.

In June 2025, the Government confirmed the opening of HS2 would be delayed beyond the target date of 2033 – and would not say when it would begin operating. 

A spokesperson for HS2 Ltd told the Daily Mail: 'A narrow focus on business travellers fails to capture the huge range of wider economic benefits being delivered by the UK's biggest infrastructure project. 

'HS2 is transforming Britain's rail network by almost doubling rail capacity between our two biggest cities and unlocking at least £20billion of investment around our stations through new jobs, homes and leisure opportunities.

'HS2 is now undergoing a comprehensive reset to ensure that these benefits are delivered as quickly as possible and for the lowest reasonable cost to the taxpayer.'

Proponents of HS2 cite research claiming £20billion of redevelopment is forecast to be delivered around its sites in the West Midlands and West London before the first trains operate, with some 63,000 homes and 50,000 new jobs being created.

• Can HS2's skyrocketing costs justify its extension to London Euston, or is the price tag too hefty for taxpayers to bear?
• Why is HS2 spiraling into a costly fiasco that might skyrocket past £100 billion?
• How did HS2's projected budget spiral from £37.5billion to a jaw-dropping £66billion in the latest controversial estimate?
• Is the scaled-back 'HS2 light' project the £60 billion magic ticket for bridging Manchester and Birmingham?
• Is the ambitious HS2 London Euston expansion a triumph for infrastructure, or a ticking time bomb for UK's colossal debt mountain?