Network Fail inspires Times leader and ITV News report

The ASI's latest paper, Network Fail, inspired this morning's Times leader "Money Pit: It is not inevitable that every big infrastructure project should cost billions and still soar over budget. Ministers must be held to account".

The article noted:

The most pernicious orthodoxies are those that evolve out of indifference. In Britain today it is accepted as inevitable that whenever a politician promises a new public project, the eventual cost will be far higher than the one first pledged.

HS2, the high-speed rail line, currently has a budget of £55 billion. This week, the Adam Smith Institute suggested the cost could rise to close to £80 billion. Yesterday The Times reported that the cost of renovations to the House of Commons could exceed £4 billion. 

Our Head of Research, Ben Southwood, also took to our screens to discuss the paper and the soaring costs of HS2 on ITV News.

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Latest paper, Network Fail, makes for good commuter reading

The ASI's latest report, Network Fail: Getting UK Rail Back on Track, made this morning's papers. Featuring as the lead story in The Sun's city section and The Times homepage leader as well as the Daily Express, City AM and the Mail Online.

The Times reported:

The High Speed 2 rail project will cost up to nine times more than similar tracks in France and should be scrapped, the prime minister has been told. It would be “economically irresponsible” to press ahead with the project because the eventual costs could rise to £80 billion, according to an analysis by the Adam Smith Institute, a free-market think tank.

Running the trains at higher speeds, the need for new stations and the lack of existing expertise in building high-speed lines have all been blamed for making the construction of HS2 more expensive than projects overseas.

The Sun reported:

Ministers must sell off part of Network Rail to ease Britain's train chaos, a think tank urges today. It recommends that up to 49.9 per cent of the UK's track operator should be offloaded to smaller rail companies.

The Adam Smith Institute said efficiency would improve if they were responsible for the lines their trains run on - while £8billion would be raised for the public purse to boot.

The Daily Express reported:

Experts at the Adam Smith Institute called for Network Rail to be sold off by the Government and for the £50billion HS2 High Speed rail line to be scrapped.

City AM reported:

Southwood said that he didn’t think that Southern ought to be stripped of the franchise, as has been advocated by the London Assembly today. This is because of the way the franchise agreement is structured as a management contract.

He said the fact that Department for Transport tells Southern Rail exactly how to operate and then pays it a management fee for doing so undermines the whole process. “If you tell them everything to do then you are not really running a private company,” he said.

Mail Online reported:

The report called for the return of "vertical integration" in the rail network with smaller lines being progressively stripped from NR, and in the longer term regional railway companies emerging. More competition between operators should be promoted, according to the institute. Fewer than 1% of passenger miles travelled in Britain are on lines where competition exists through open access concessions.

The paper was also covered by 140 regional titles and rail trade publications.

NETWORK FAIL: Sell off Network Rail and scrap HS2 to get British train travel back on track

New report from the Adam Smith Institute calls on government to scrap costly HS2 and part privatise debt riddled Network Rail

• Network Rail a massive drain on the taxpayer with £37.8 BILLION net debt
• Government should sell off up to 49.9% of Network Rail raising £8 billion
• Smaller railway lines should buy the tracks they run on from Network Rail and more competition between providers on trunk routes should be promoted
• Hugely costly HS2 should also be scrapped and the focus put on electrification to stimulate the Northern Powerhouse

A new paper released this morning by the Adam Smith Institute calls on the government to get Britain’s trains back on track and ease the huge burden on the taxpayer.

The report, “Network Fail: Getting UK Rail Back on Track”, urges the government to sell off 49.9% of Network Rail, which it says lacks the discipline of the private sector, and should seek to replicate the success of the privatisation of the National Grid worth over £35bn.

Network Rail is an unwieldy beast with a vast debt burden of £37.8bn that is now included in public liabilities. It is a strain on the taxpayer and up to 49.9% needs to be sold off the paper argues: the Government’s 40% Eurostar disposal has shown there would be no lack of buyers.

The paper urges the government to promote vertical integration of smaller Network Rail-owned lines and to crack down on under performing rail franchise holders, terminating their franchise if necessary. Competition between providers on lines should also be promoted where possible, with only 1% of passenger journeys currently facing any direct rail competition.

The hugely costly and inefficient HS2 programme should also be scrapped the report urges. Currently on course to cost the taxpayer in excess of £50 billion, the HS2 project is both unnecessary, with current off-peak occupancy levels well below 50%, as well as being economically irresponsible - the numbers simply do not stack up. The report reveals that HS2 is costing up to 9x more per mile than high speed tracks in France, and will be reaping rock bottom returns.

If the UK is to achieve its “Northern Powerhouse” revival then it must focus on schemes like electrification of the TransPennine Railway and moving ahead with the London-Sheffield mainline. 

Adam Smith Institute fellow and author of the paper, Nigel Hawkins, said:

“Action to sort out Britain's railways is a priority. Radical decisions are needed to deliver financial competence, sensible investment and improved customer benefits into the system.

“Scrapping the shockingly expensive HS2, selling up to 49.9% of Network Rail and cracking down on under-performing franchises are priorities.”

-ENDS-
 
Notes to editors:

For further comments or to arrange an interview, contact Flora Laven-Morris, Head of Communications, at flora@adamsmith.org | 07584 778207.

To report “Network Fail: Getting UK Rail Back on Track” will be live on the Adam Smith Institute website from 00:01 8th September 2016 and can be accessed ahead of time here. 

The Adam Smith Institute is a free market, libertarian think tank based in London. It advocates classically liberal public policies to create a richer, freer world.

Revoking Fabric's license is a disgrace says Sam Bowman

Following the news that Fabric has had its license revoked and will be forced to close, Sam Bowman made the following comment:

The decision by Islington Council to revoke Fabric’s license is a disgrace, and exactly the wrong way to reduce deaths from drugs. Closing Fabric won’t stop people from taking drugs at other clubs, even if they step up their searches of clubbers. Heavy-handed drugs searches are security theatre: they make non-clubbers feel happy, but realistically people will always be able to take drugs into clubs – there’s only so much security can do.

The objective should be to reduce harm to drug users, and the way to do that is to let them know what they’re using. That means testing drugs that are circulating in clubs and warning drug users if potentially dangerous batches are around – a scheme that has been piloted by some clubs in the past, and was tried successfully at the Secret Garden Party festival this summer. Acknowledging that people will take drugs, but doing what we can to keep them safe while they do so, is how we can avoid drug deaths.

Sam's comments featured in the Guardian and Mirror Online.

For further comments or to arrange an interview, contact Flora Laven-Morris, Head of Communications, at flora@adamsmith.org | 07584 778207.

Sam Bowman reacts to ruling out of points based immigration system

Sam Bowman, Executive Director of the Adam Smith Institute, reacting to the news that the Prime Minister has ruled out a points based immigration system, said:

“It’s great news that the Prime Minister has ruled out a points-based immigration system for EU nationals. Although we expect that some controls on freedom of movement are inevitable after Brexit, a heavy-handed approach would be bad for Britain. One option may be to only allow people who already have a job offer to immigrate.
 
“EU immigrants pay more in taxes than they cost in services and so help pay for the pensions, healthcare and education of native Britons, and curbing them harshly would probably make it impossible for us to remain in the Single Market. They do not harm the wages or job prospects of native workers. (http://www.adamsmith.org/blog/immigration-is-no-reason-to-leave-the-eu) 
 
“This move by the Prime Minister is doubly encouraging because it suggests that Mrs May wants to go for a global Brexit. She is right to reject policies that would close us off from Europe – the real prize now will be opening up to the world.”

Sam's comments were included in print and online across the Guardian and the Daily Express.

For further comments or to arrange an interview, contact Flora Laven-Morris, Head of Communications, at flora@adamsmith.org | 07584 778207.