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HS2 alone won’t address the north-south divide

TGV POS, the world’s fastest train - but high speed rail won’t bring prosperity to the regions as quickly. bigbug21/Wikipedia

A commitment to building a new wave of high-speed rail networks has emerged, such as HS2 in Britain. But given how costly they are, their wider impact has been under-investigated. It is little wonder that zero-sum-game thinking has led people to believe that if the capital gains, the regions must lose, and so any benefits from HS2 will likely flow to London and the south.

Essentially, whether regions linked to capital cities by high speed rail (HSR) benefit or not is controversial. Some places appear more resilient to changes than others. In line with Paul Krugman’s assumption of imperfect competition, given that thriving places gain increasing returns, lagging regions when connected by cross-border transport links expose themselves to fiercer competition from firms in more developed areas. Models predict that non-capital regions in fact suffer increased regional inequality, rather than benefits.

This is in sharp contrast to the French experience found in the TGV-Sud-Est line between Paris and Lyon. Here growing inequality between the capital and the regions was slowed because easy accessibility to Paris for specialised service industries in the Rhône-Alps region meant Lyonnaise firms no longer needed to relocate to Paris. One of a few empirical studies attempted to measure economic performance in individual cities linked by HSR by comparing the situation before and after. It’s difficult to draw any solid conclusions from them, however.

When policy makers struggle to find instant, universal answers to the question marks hanging over the effects of HSR, the tendency is to conclude that transport is a necessary, but not sufficient condition for improving the regions. There are other factors to be taken into account - perhaps most importantly, the lack of a systematic planning study. Building HSR does not necessarily benefit the national capital at the expense of other regional cities (in the case of the UK’s plan, Birmingham, Manchester, Sheffield and Leeds). Likewise, a revival of major provincial cities does not automatically lead to a regional economic boom or the reduction of regional inequality.

One study looked at the impact of the Intercity 125/225 high speed trains introduced by British Rail during the 1970s and 80s. Examining major cities on six selected rail lines over 30 years, the study revealed that effects varied between those linked to the high speed rail network and those that were not, and depended on time and distance from London.

Of towns and cities linked to the Intercity network, the findings distinguished both residential and economic strength of those one hour from London, a revival of those between one and two hours from London, and weak effects for those more than two hours away. In contrast, those towns and cities not linked to the Intercity network but within an hour from London could not demonstrate the same economic strength or improvement. Beyond two hours from London, towns off the network showed no evidence of residence or economic development.

Although there are exceptions, the findings suggest that high speed rail had substantial effects within two hours of London, helping to generate renewed economic growth. But the effects are not guaranteed or equally distributed.

The second study draws from a comparative study of Lille in France and Manchester in the UK, which centres on the West Coast Main Line (WCML) modernisation versus the new dedicated TGV-Nord line for the Nord-Pas-de-Calais region. Similarly, the study found that although major regional cities are reinforced by becoming HSR hubs, the effects have not necessarily spread to surrounding areas. Regional inequality was reduced in France, but widened in Britain.

This is the major point for policymakers - to spread the benefits of enhanced inter-city links, high speed rail should be treated as a central part of a wider improvement program which establishes better transport links and economic relationships between regional cities and their hinterlands.

Seamless multi-level transport networks integrated with HSR are critical for wider regional development. Towns and boroughs not served by high speed links are not necessarily disadvantaged, so long as urban transit links connect them effectively to HSR hubs.

In Nord-Pas-de-Calais, the regional government’s first move to bring HSR services to the region was to electrify conventional rail lines, add two branches, and then make significant changes to the rail services to shift it from a Paris-oriented to a Lille-oriented network. In contrast, in North West England the dominant market-led approach that underpinned the WCML service catered to better-off places and cancelled services in poor places. The priority on long distance inter-city services squeezed out any spare capacity for regional and cross-country services, with the effect of reinforcing regional inequality.

There are other factors that have an important impact on regional development. Spatial planning policy has evolved in distinctly different ways according to the two national contexts, in turn making government intervention more or less straightforward. Other factors, such as city types, local conditions, institution, funding resources and leadership all have their part to play in pushing forward or dragging down any potential regeneration. This helps to explain the different results between the two regions.

In the light of these findings, what aspects are in place in the UK to best exploit the opportunities that HS2 could bring? There needs to be a strong national political economy with vision and concern for equality, a spatial-economic framework that is conducive to helping local governments negotiate local interests, a strategy for integrating high speed rail hubs seamlessly into regional and local rail networks, and re-development initiatives that go beyond just transport.

The current absence of regional planning mechanisms in England is problematic and needs to be tackled. Breaking down antagonism and rivalry between districts in cities and their hinterlands would go a long way toward building cross-region infrastructure that could address inequality.

This is a long term process, and action needs to be taken now at national and local levels to be ready to amplify the benefits by 2032 when HS2 is due to be completed. Without looking beyond HS2 itself into the long term, the prospects of reducing the north-south divide are minimal.

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