Wales is paying for HS2 but it will harm our economy – we must receive the £5 billion we are owed
Jonathan Edwards, Plaid Cymru MP for Carmarthen East and Dinefwr
Yesterday the government surrendered to vested interests and group-think, approving HS2, a £100 billion project that will become a case study for bad public investment. Despite ballooning costs, dissenting reports and widespread public opposition, Boris Johnson just couldn’t resist yet another big white elephant.
Far more than a costly infrastructure project, HS2 has also shown how Westminster had once again used the flawed Barnett formula to short-change Wales. Despite not a single metre of the proposed HS2 line being in Wales, the Westminster Government has classified the project as benefitting England and Wales, while Scotland and Northern Ireland both receive full Barnett payments for HS2.
This classification is critical as the Barnett formula works by allocating funds to the devolved nations based on their population’s proportion of the UK population as a whole. With Westminster pigeonholing HS2 as an England and Wales project, it means Wales won’t receive full Barnett consequential payments and will lose out on £5 billion of funding.
This is a huge sum of money that could be used to rebuild and revitalise Welsh transport infrastructure. It would more than pay for the costs of a north-south Wales link and would help build the infrastructure for our low carbon future.
I have long been an opponent of HS2 on the grounds that its business case doesn’t add up, its management has been awful and is underpinned by unrealistic expectations. The dissenting Berkeley report into the project estimated an abysmal cost-benefit ratio of only 60 pence returned for every pound of investment.
It’s true that the UK needs more rail capacity. It’s an effective form of public transport and one that will play an increasing role as we decarbonise transport. I also welcome investment in underperforming regions of the UK to boost productivity by improving transport links.
However, HS2 will primarily benefit London, ensuring the South-East of England continues to enjoy astonishing economic growth and rising incomes as Westminster throws more cash at its infrastructure.
HS2 has consistently failed to match expectations or any target throughout its existence. Originally priced at £36 billion in 2009, HS2’s costs have tripled to over £100 billion, without a single metre of track being laid.
In comparison, Wales’ infrastructure is critically underfunded. With 11% of the UK’s railway and 5% of its population, Welsh railways receive only 1% of Westminster rail investment. Simply put, HS2 shows just how little Westminster cares about Wales.
The Westminster Government is being equally dishonest about the supposed economic benefits, particularly to Wales. The Government’s own accountants on the project noted that HS2 would do significant damage to the Welsh economy, particularly in the south of Wales.
By attracting businesses and investment away from Wales, it is estimated that HS2 will cost Cardiff alone £67.95 million and areas as west as Carmarthenshire approximately £12.14 million per annum. These are significant costs for areas already suffering from years of political and economic neglect by Westminster.
HS2 is a disaster for Wales. Not only do we have to pay for a grossly over-budget project that will do long-term damage to the Welsh economy, but we also won’t receive the £5 billion we are owed to help mitigate the damage of HS2 and rebuild Wales’ railways.
Given the sheer harm that HS2 will do to Wales and the injustice of Westminster’s manipulation of the Barnett formula, my Plaid Cymru colleagues and I will continue fighting for the full compensation of £5 billion for Wales. Westminster cannot get away with using the Barnett formula only when it suits them.
More broadly, the HS2 fiasco and Westminster’s broken promises on rail electrification have shown us that they won’t be doing anything to support Welsh infrastructure for years to come. With the UK infrastructure budget consumed by HS2, Wales must push immediately for the full devolution of transport and further fiscal powers so that we can get Welsh infrastructure and the economy back on track.
Ultimately, HS2 has shown us Westminster never has and never will work for Wales. We will never be a priority for decision-makers in London who want to build a high-speed railway in England while Welsh commuters use outdated and overcrowded diesel trains.
Westminster’s gloating over HS2 insults the struggle of my constituents to access basic transport services, let alone electrified rail. Faced with years of local authority budget cuts that have seen fewer bus routes and rising ticket prices, often disproportionately affecting rural areas, Westminster’s recklessness with £100 billion of public money is astounding.
Equally shocking is Labour’s silence on HS2. In Cardiff Bay, Labour have sat meekly on their hands while Westminster ignores its own funding rules and tells Welsh taxpayers to foot the HS2 bill.
HS2 begs the question whether Wales can afford another five years of Labour in Cardiff and the Tories in Westminster taking Wales for granted, or whether HS2 is the wake-up call we need. In 2021, Welsh voters have a choice between the Westminster parties who will sell our interests down the tracks or Plaid Cymru who will always work for Wales.