Report says HS2 will generate £15bn a year

After criticism from the House of Commons Public Accounts Committee this week that HS2 Ltd had failed to make the case for the project, the government-owned company has made a timely rebuttal.

An analysis by KPMG prepared for the developer claims that HS2 would boost the UK economy by £15bn a year, thus generating more than £5bn in tax receipts for the exchequer.

The report also gives a breakdown of the economic benefits for each HS2 city region, with variations in the impact on particular regions. Birmingham’s economy will get a yearly boost equivalent to 2.1 to 4.2% of the city region’s GDP. For Manchester, the figure is 0.8%-1.7%, for Leeds 1.6% and for Greater London 0.5%.

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. It shows the UK will be £15bn a year better off with HS2, recovering the cost of the scheme within just a few years.

“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 full report, HS2 Regional Economic Impacts, is available from HS2 Ltd's website.