Is Philip Hammond counting his blessings? #HS2 downgrade embarrassment avoided for ex transport sec

Lucky old Philip Hammond. For all the obvious challenges at the Ministry of Defence he must be counting his blessings that is no longer having to manfully struggle on at the DfT in the face of worsening news about its flagship policy: the latest downgrading of the economic case for HS2.

A document just published shows that because of a revision over the point at which passenger growth for HS2 should be capped (i.e. regarded as having saturated) the already low BCR values need to be cut even further:

“Adjusting the cap year in this way would reduce the BCRs for both HS2 and the alternatives to HS2, including a new conventional speed line and enhancements to existing routes. For HS2, this modelling change would lead to a reduction in the BCR (excluding wider economic impacts) for the London to the West Midlands scheme of approximately 0.2. The impact on the BCR for the full Y high speed rail network (excluding wider economic impacts) is estimated to be a reduction of between roughly 0.3 and 0.4.”

That means the BCR of phase one of the scheme now becomes an officially ‘low’ 1.2 and, at worst, the BCR for the full network also tumbles to 1.2.

All of which means that Mr Hammond must be glad he doesn’t now have to act on the words he previously uttered in front of the Transport Select Committee when talking about the original benefits of HS2:

“As rail projects go, a benefit-cost ratio of 2.6 is quite reasonable. If it were to fall much below 1.5, I would certainly be putting it under some very close scrutiny.”

Oh dear.

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#Cars by numbers

The latest vehicle licensing stats have been released by the DVLA and as usual they make for interesting reading for both the pub quiz trivia question setter and the transport expert.

Here is some of what has been revealed:

• At the end of 2011 there were 34.2 million vehicles licensed in Britain
• 28.5 million of these were cars (up from 21.2 million in 1994)
• Year on year the total number of vehicles rose by 0.3%
• During 2011 2.38 million vehicles were registered for the first time (down 36,000 on the previous year)
• At the end of 2011, the most common car in Great Britain was the Ford Focus (1.4 million) followed by the Ford Fiesta (1.3 million)
• In total Ford accounts for 15% of all cars on the roads
• The Ford Fiesta was the most popular new car registered during 2011
• The proportion of new diesel cars registered has risen above 50% for the first time
• Average emissions from all cars registered from 2001 onwards stands at 163gCO2/km down 1.5% on 2010
• The average new car emission rate was 138 gCO2/km
• Since 2001 average new car emissions have fallen by 21%

Most worryingly for the Treasury is the marked percentage increase in registrations of greener cars. In 2011 65% of cars fell into VED bands A to E (up to 140 gCO2/km). This is up from 55% in 2010, thus threatening the flow of money into the Exchequer’s coffers. No wonder the Chancellor made this announcement in the Budget:

“The Government will consider whether to reform VED over the medium term, to ensure that all motorists continue to make a fair contribution to the sustainability of the public finances, and to reflect continuing improvements in vehicle fuel efficiency.”

Mr Osborne also said he would be looking to introduce a monthly direct debit payment option for VED – clearly he is looking at ways to spread the pain which will inevitably follow.

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