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The UK economy could benefit by £15 billion per year from the HS2 rail line, according to a report commissioned by the company developing the project.
The study carried out by business advisor KPMG and commissioned by HS2 Ltd claims that the UK regions will be the “biggest winners” from HS2 which is set to cost taxpayers £42.6 billion.
The high-speed rail line will initially link London and Birmingham from 2026 followed by two spurs to Manchester and Leeds which are scheduled to open in 2032.
KPMG estimates that HS2 will boost Birmingham’s economy by 2.1 to 4.2 per cent per year while Manchester would benefit by between 0.8 to 1.7 per cent and Leeds by an estimated 1.6 per cent. Greater London would receive an estimated 0.5 per cent rise in business due to HS2.
The release of the report comes just two days after MPs on the Public Accounts Committee questioned the project’s “rising costs and dwindling benefits”.
Richard Threlfall, KPMG’s head for infrastructure, building and construction, said: “There have been repeated calls for a business case for the HS2 scheme focused on jobs, productivity and growth. KPMG’s analysis forms a key part of that business case, setting out the economic impact across the country of the HS2 scheme.
“It shows beyond reasonable doubt that HS2 brings net benefits to the country of many times the scheme’s cost.
“Our analysis also shows that HS2 will significantly help counter the corrosive effects on our country of the widening north-south divide. There has been a long-running debate about “who wins” from HS2, the north or the south? The answer is both.”
The KPMG report is part of a fight back by HS2’s supporters against a wave of criticism of the project in recent weeks. Transport secretary Patrick McLoughlin and chancellor George Osborne have both defended the scheme in recent days.
McLoughlin again set out the case for HS2 during a speech today (September 11) at the Institution of Civil Engineers in London.
"HS2 will allow you to get from Birmingham to Leeds in 57 minutes and from Manchester to London in 68," said McLoughlin.
"The benefits of faster journeys are easy to explain but the main reason we need HS2 is as a heart bypass for the clogged arteries of our transport system. It will lift the burden from our overcrowded system.
"Because the point about High Speed Two is that you won’t have to travel on it to gain from the better transport system and economic growth it will support. People who may never use the new line will still gain from more services for towns and cities up and down Britain."