HS1 passenger forecasts 'not met'

 

International passenger numbers on the HS1 Channel Tunnel high-speed rail line are falling far short of original forecasts, a report from a Government spending watchdog said today.

The project costs of the £6.16 billion London to Folkestone line have exceeded the value of journey-time saving benefits, the National Audit Office (NAO) report said.

Passenger numbers between 2007 and 2011 were, on average, two-thirds of the level forecast when the Department for Transport (DfT) guaranteed the project debt in 1998 to enable the line to be built, the NAO said.

NAO head Amyas Morse said: "The HS1 project has brought a number of significant benefits including quicker journey for passengers.

"However, the project went forward on the basis of hugely optimistic assumptions about international passenger numbers. These were not realised and the department is only now developing its plan to evaluate whether the project was value for money."

The first section of the line, which is used by 186mph Eurostar trains between London and Paris and Brussels, was completed in 2003, with the full line open in 2007.

Originally run by London & Continental Railways (LCR), the line was sold to a consortium in November 2010 for just under £2.05 billion.

The NAO report today - the third it has made on HS1 - said the project had delivered a high-performing line, which was subsequently sold in a well-managed way which removed the taxpayer's open-ended support for the project.

But it added that international passenger numbers were falling far short of original forecasts and the project costs exceeded the value of journey-time saving benefits.

The NAO said the £6.16 billion construction cost was 18% higher than the target costs but that this performance "compares well with other railway projects".

The report also said the line had performed well since it opened, with only 0.43% of services being delayed in 2010-11 by infrastructure incidents, such as track or signal failures.

But the below-forecast passenger numbers had left the taxpayer exposed to the risk of lower-than-expected passenger income, which had been expected to repay the project debt, the NAO said..

The report said the original business case for the line in 1998 was based on benefits to transport users from faster journey times and increased rail capacity and regeneration benefits.

The report said the total value of these benefits was not known. It added that the DfT had started to identify the methods it will use to evaluate the project's costs and benefits.

The report added that the department had not reassessed these costs and benefits since 2001, despite assurances to the House of Commons Public Accounts Committee that it would do so.

Commenting on the NAO report, Margaret Hodge MP, chairman of the House of Commons Public Accounts Committee, said: "I am yet to be convinced that HS1 will prove to be value for money. Yet again we hear that value for money will depend on uncertain benefits which have not been quantified. We will want the department to do all it can to realise the benefits and turn this sorry story round.

"Compared to the staggering mismanagement of the West Coast mainline upgrade, the department did relatively well with the construction of HS1. But that is damning with very faint praise indeed. It's a sad state of affairs when it comes as no surprise that HS1 was based on dodgy assumptions and bad planning."

A DfT spokesman said: "The department has significantly improved its passenger forecast modelling since the original work for HS1 some 20 years ago.

"HS1 was delivered on time and on budget and this report points to the significant benefits it has achieved, not just for passengers, but for the taxpayer, including when it was sold for more than £2 billion, far exceeding market expectations."

PA

Start your day with The Independent, sign up for daily news emails
Voices
Lucerne’s Hotel Château Gütsch, one of the lots in our Homeless Veterans appeal charity auction
charity appeal
Sport
Brendan Rodgers is confident that Sterling will put pen to paper on a new deal at Anfield
footballLIVE: Follow all the latest from tonight's Capital One quarter-finals
Life and Style
A woman walks by a pandal art installation entitled 'Mars Mission' with the figure of an astronaut during the Durga Puja festival in Calcutta, India
techHow we’ll investigate the existence of, and maybe move in with, our alien neighbours
Arts and Entertainment
Tony Hughes (James Nesbitt) after his son Olly disappeared on a family holiday in France
tv
PROMOTED VIDEO
Have you tried new the Independent Digital Edition apps?
News
ebooksNow available in paperback
News
people

Jo from Northern Ireland was less than impressed by Russell Brand's attempt to stage a publicity stunt

Voices
Jimmy Mubenga died after being restrained on an aircraft by G4S escorts
voicesJonathan Cox: Tragedy of Jimmy Mubenga highlights lack of dignity shown to migrants
News
i100
Arts and Entertainment
Jim Carrey and Jeff Daniels ride again in Dumb and Dumber To
filmReview: Dumb And Dumber To was a really stupid idea
Life and Style
tech
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs General

Ashdown Group: Helpdesk Analyst

£25000 per annum: Ashdown Group: An established media firm based in Surrey is ...

Ashdown Group: Java Developer - Hertfordshire - £47,000 + bonus + benefits

£40000 - £470000 per annum + bonus: Ashdown Group: Java Developer / J2EE Devel...

Ashdown Group: Head of Finance - Financial Director - London - £70,000

£70000 per annum: Ashdown Group: Head of Finance - Financial Controller - Fina...

Recruitment Genius: Business Development Executive - Nationwide - OTE £65,000

£30000 - £65000 per annum: Recruitment Genius: This small technology business ...

Day In a Page

Calls for a military mental health 'quality mark'

Homeless Veterans campaign

Expert calls for military mental health 'quality mark'
Racton Man: Analysis shows famous skeleton was a 6ft Bronze Age superman

Meet Racton Man

Analysis shows famous skeleton was a 6ft Bronze Age superman
Garden Bridge: St Paul’s adds to £175m project’s troubled waters

Garden Bridge

St Paul’s adds to £175m project’s troubled waters
Stuff your own Christmas mouse ornament: An evening class in taxidermy with a festive feel

Stuff your own Christmas mouse ornament

An evening class in taxidermy with a festive feel
Joint Enterprise: The legal doctrine which critics say has caused hundreds of miscarriages of justice

Joint Enterprise

The legal doctrine which critics say has caused hundreds of miscarriages of justice
Freud and Eros: Love, Lust and Longing at the Freud Museum: Objects of Desire

Freud and Eros

Love, Lust and Longing at the Freud Museum
France's Front National and the fear of a ‘gay lobby’ around Marine Le Pen

Front National fear of ‘gay lobby’

Marine Le Pen appoints Sébastien Chenu as cultural adviser
'Enhanced interrogation techniques?' When language is distorted to hide state crimes

Robert Fisk on the CIA 'torture report'

Once again language is distorted in order to hide US state wrongdoing
Radio 1’s new chart host must placate the Swifties and Azaleans

Radio 1 to mediate between the Swifties and Azaleans

New chart host Clara Amfo must placate pop's fan armies
Homeless Veterans appeal: 'It's life, and not the Forces, that gets you'

Homeless Veterans appeal: 'It's life, and not the Forces, that gets you'

The head of Veterans Aid on how his charity is changing perceptions of ex-servicemen and women in need
Torture: It didn't work then, it doesn't work now

Torture: It didn't work then, it doesn't work now

Its use is always wrong and, despite CIA justifications post 9/11, the information obtained from it is invariably tainted, argues Patrick Cockburn
Rebranding Christmas: More public bodies are refusing to give the festival its name for fear of causing offence

Rebranding Christmas

More public bodies are refusing to give the festival its name for fear of causing offence. They are missing the point, and we all need to grow up
A Greek island - yours for the price of a London flat

A sun-kissed island - yours for the price of a London flat

Cash-strapped Greeks are selling off their slices of paradise
Pogues could enjoy fairytale Christmas No 1 thanks to digital streaming

Pogues could enjoy fairytale Christmas No 1 thanks to digital streaming

New system means that evergreen songs could top the festive charts
Prince of Wales: Gruff Rhys on his rock odyssey, and the trouble with independence

Prince of Wales: Gruff Rhys

He is a musician of wondrous oddity. He is on a perpetual quest to seek the lost tribes of the Welsh diaspora. Just don't ask Gruff Rhys if he's a national treasure...