By Daniel Hunter
Richard Threlfall, Head of Infrastructure, Building and Construction at KPMG, has said that developments for phase two of the high speed 2 could boost economic output from £17 billion to £29 billion by 2040.
The proposed route and the locations of new stations in the West Midlands, north west, East Midlands and Yorkshire were unveiled this morning as David Cameron, Deputy Prime Minister Nick Clegg, Chancellor of the Exchequer George Osborne and Transport Secretary Patrick McLoughlin underlined the government’s absolute commitment to investing in the infrastructure that Britain needs to compete and succeed in the global economy.
“Today’s announcement is good news for Britain’s transport network and for our economy," Threlfall said.
“Our own analysis shows that better business to business connectivity will enhance productivity and employment and thereby would contribute to economic growth. Ultimately HS2 would also generate substantial additional tax revenues to the exchequer.
“We predict that a high speed rail network across the UK could boost annual economic output between £17bn and £29bn in 2040.
“Additional annual economic impacts on this scale could increase annual tax receipts by between £6bn and £10bn in real terms by 2040.”
“Our work suggests high speed rail offers a good return to the Treasury and to the taxpayer and is a cost effective approach to securing future national prosperity.
“Today’s announcement is also fantastic news for our northern city regions. It is a bold statement by the Government of its intention to redress the UK’s economic power balance. The last decade has seen a significant shift in the UK’s economic centre of gravity towards London and the South-East.
"In 1999 31.9% of the country’s economic productivity originated in the South-East, today it is more than 35%. Today’s news could be the first step towards shifting more power towards the Midlands and the North of the country so that the UK as a whole operates as an economic powerhouse.”
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