This week’s focus: A new £16 billion high-speed rail link between London and Birmingham (HS2) has been proposed by the government. The Secretary of State argues that each £1 invested in the scheme will generate growth of £1.40, and therefore represents good value for money.
But what are the assumptions that underpin these forecasts? And what are the alternatives to the rail link that will meet the government’s objective (whatever that happens to be)? I have been in too many business meetings where a business case has been presented that is based on spurious assumptions, and we have all seen the cost of too many government schemes double or treble in size, to have any confidence that there is any value for money in HS2 at all.
Sometimes you can’t make a decision simply on the basis of a financial assessment – particularly where most of the data is made up! Instead you must use your commercial judgement and old-fashioned common sense.
Off the record: Downtown Train by Tom Waits
Will you meet me tonight, on a downtown train?
All of my dreams just fall like rain
All upon a downtown train
© Stuart Cross 2012. All rights reserved.