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Report says HS2 will deliver bigger benefits to North than London
THE North-East will share a £7bn annual economic boost from high-speed rail, according to a study, giving the troubled HS2 project a huge boost.
The analysis knocks back a key criticism of the £42.6bn scheme by saying it will deliver bigger benefits to the North than London.
It predicts a five per cent leap in the number of jobs in the North-East when the 225mph rail links to London are completed in 2033.
The scheme is expected to deliver a £15bn boost to the British economy, of which up to £7bn will flow to areas not directly reached by super-fast trains.
The study, by consultants KPMG, will be seized on today by Transport Secretary, Patrick McLoughlin, as proof the Government is right to press ahead with HS2.
The scheme has received criticism as its costs spiral, with ministers accused of using out-of-date data and assumptions to justify building a high-speed network.
However, Mr McLoughlin will say: “The big choices we make about infrastructure today have a big effect on economic output tomorrow, and that is the benefit we will see from HS2.
“Will HS2 create jobs and growth in the North and Midlands, where they are needed most? The answer is absolutely clear. Yes.
“A £15bn annual boost to the economy, with the North and Midlands gaining at least double the benefit of the South.”
HS2 is intended to deliver 225mph trains from London to Birmingham by 2026 – and a Y-shaped network, on to Leeds and Manchester, seven years later.
Through trains will cut the Newcastle to London journey time from two hours 52 minutes to two hours 18 minutes.
KPMG puts specific figures on the likely economic boosts for areas along the route.
In the case of the North-East, the predicted annual gain, between £5bn and £7bn, is included within the rest of Britain, not on the HS2 route.
They are predicted to flow from widespread improvements to rail services on the classic network, particularly on long-distance routes.
However, KPMG admits the boost depends on the availability of skilled labour and land and describes its results as provisional.
Mr McLoughlin argued the key reason for building HS2 remained the looming need for extra capacity on a rail network with clogged arteries.
He will today say: “It will lift the long-distance burden from our overcrowded main lines so they can concentrate on what they are best at.
“More local trains and more freight trains.
“The point about HS2 is that you won’t have to travel on it to gain from the better transport system and economic growth it will support.”
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