Government ploughs on with contested high-speed rail link
LONDON (Reuters) - The government pressed ahead on Monday with a planned high-speed rail link that is opposed by many of its own MPs, striving to show it is committed to projects that will eventually revitalise a moribund economy.
The route for the second phase of the $50 billion HS2 rail project will run between Birmingham in central England and Leeds in the north, slashing journey times to London by almost a half, the Department for Transport (DfT) said.
A year ago the rail plan was threatened by a backlash from rural communities and MPs within David Cameron's own Conservative Party, who argue the scheme's economic benefits will be limited.
But the government launched the next stage of the scheme on Monday, saying it would create tens of thousands of jobs, bring growth to regions outside London as well as adding capacity to an already-stretched rail network.
"It's not just about cutting journey times. It's also about the new stations, the prosperity that's going to come, the jobs that are going to be created around this infrastructure," Chancellor George Osborne told BBC TV.
"This is going to help out country over the next 15, 20 years. If we don't take the decision now it will be left to someone else in 20 years times to take those tough decisions to invest in our future."
Figures released last week showed the economy shrank at the end of 2012, pushing it close to a "triple-dip" recession and raising questions about the Conservative-led coalition's austerity programme which critics say is strangling growth.
Just before the release of the numbers, the leader of the ruling coalition's junior partner, the Lib Dems, said that major infrastructure investment was one area where the government may have cut spending too deeply.
The DfT said the HS2 route, which will not be in operation for 20 years, will run northwards from Birmingham, stopping at Manchester, Manchester airport, Toton in the East Midlands as well as Sheffield and Leeds in the northern county of Yorkshire.
The ministry also put plans for a link between the line and London's Heathrow airport on hold until the completion of a review into the future of Britain's airports, hinting that senior government figures do not see Ferrovial's Heathrow as the best location for a future London hub.
The ministry said HS2 would create around 100,000 jobs, but the project is likely to anger rural communities through which the line will run, and their parliamentary representatives.
Cameron's Conservatives trail the main opposition Labour Party by around 10 points ahead of elections due in May 2015, and he also faces a challenge on the right from the UK Independence Party in the party's southern England heartlands.
"In looking at this route one knows that you are going to upset a number of people because the route will go through their area and that will be annoying for them and you'll get opposition to it," Transport Secretary Patrick McLoughlin told BBC Radio.
"But overall, one has got to look at the long term chances for the United Kingdom. This is the first railway to be built north of London for a 120 years."
The government said a final route for phase two would be chosen by the end of 2014. Trains running on HS2 will be able to reach speeds of up to 250 miles per hour, the DfT said.
Phase one of the project will link London and Birmingham. It will reduce journey times between Birmingham and London to 49 minutes from the current one hour and 24 minutes, according to the DfT. The Birmingham to Leeds journey will be cut to 57 minutes from two hours.
Construction of the London-West Midlands route is due to start in 2017 with work on the extension likely to kick off by 2025 to enable the line to be operational by 2033.
British transport union the RMT said the project was long overdue, saying Britain was "miles behind the rest of Europe when it comes to High Speed and electrification".
Britain has long toiled with charges that it lags behind other European networks like France's high-speed TGV system, and developing nations like China, which earlier this month started using the world's longest high-speed railway line.
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DAVOS, Switzerland - Central banks have done their best to rescue the world economy by printing money and politicians must now act fast to enact structural reforms and pro-investment policies to boost growth, central bankers said on Saturday.