High Speed 2 : Get Ready

A report to the Government by

the HS2 Growth Taskforce

This document has been withdrawn.

See the government's response.
2
Contents
Foreword 4
Executive Summary 5
Getting our Cities Ready 12
Getting our Transport Network Ready 20
Getting our People Ready 30
Getting our Businesses Ready 38
Next Steps 44

3
Foreword
In this country, we expect the Government
to fully justify the value of major new
projects. We are right to demand this, but
once the debate has been had, there comes
a time for action.

As the Chief Executive of the London

Organising Committee for the Olympic
Games and Paralympic Games, I travelled
the journey from initial scepticism to what I
hope you will agree was a national triumph.
The most powerful lesson I drew from the
Olympics was the extraordinary capability
we have in this country when we believe in
something. When we focus on a clear set of
objectives and go about delivering them
collaboratively, with everyone working together,
from across the private and public sectors, across I am indebted to my fellow Taskforce members for
the country and across political parties, we can ensuring we kept to a high level of ambition, and
achieve pretty much anything. to the many people we met around the country
whose drive and passion demonstrates that Britain
I assembled this Taskforce to examine what we has what it takes to get the best out of this
have to do as a country to bring that same focus on game-changing project if we tackle it together.
results and pride in delivery to the HS2 project.
HS2 is a once in a generation opportunity and we
Our aim, quite simply, has been to lay out what have to act now to get it right.
needs to be done now to ensure we extract every
penny of value from HS2 for the UK. Our conclusion Lord Paul Deighton
is that HS2 could be much more than a railway. Chair of the HS2 Growth Taskforce
It could be an exciting and transformational
opportunity, particularly for our cities in the
Midlands and the North, to invest in our future
economic growth.

This report makes clear that we must not take a

‘build it and they will come’ attitude to HS2. It is
up to all of us in the Government, local authorities,
HS2 Ltd and UK businesses to make the most of this
unique opportunity.

4
Executive Summary
The HS2 Growth Taskforce We have structured our report around four areas
where we need to start to prepare now in order to
The High Speed 2 (HS2) Growth Taskforce was maximise the eventual benefits of HS2.
created in summer 2013 to advise the Government
on how to maximise the return from the investment Getting Our Cities Ready:
in HS21.
HS2 can help rebalance the economy,
This report sets out the main challenges that we kick-starting growth and regeneration in
can see in maximising the benefits from HS2, and our cities. Our recommendations call on HS2
our recommendations on what should be done places to develop dedicated HS2 Growth
to address these. We set out a range of challenges Strategies to bring forward development
for the Government, local authorities, HS2 Ltd and earlier and to establish dedicated delivery
UK businesses and workers; all of which stand to bodies to coordinate investment around HS2
benefit from HS2. stations. The Government should support
local authorities to deliver their HS2 growth
We draw on our collective knowledge and strategies and provide national coordination
experience in business, the public sector and through a central delivery body (which works
academia, and our direct involvement in major with local delivery bodies). To ensure growth
infrastructure projects around the world. and regeneration around HS2 remains a
priority, the Government should appoint a
This report is also based on the evidence we Minister with responsibility for overseeing this
have gathered through engagements over the support and delivery of the strategies.
last six months in Birmingham, Manchester,
Loughborough, Sheffield, Leeds, Liverpool and
London. We heard evidence from local authorities,
Local Enterprise Partnerships (LEPs), major
employers, universities and other interested parties
from these cities and from across the regions that
surround them. We are grateful to all those whom
we have met or sent us written submissions.

Our findings
The scale of HS2 is without precedent. It could
catalyse far-reaching economic and social benefits,
particularly to the cities of the Midlands and the
North. So it is clear to us that we cannot expect
to get the most out of HS2 simply by following
“business as usual”. We must set our sights high,
challenge the status quo and be clear about our
goal of building a truly transformational piece of
national infrastructure.

1
The Terms of Reference and the Taskforce’s initial report are available here: https://www.gov.uk/government/policy-advisory-
groups/hs2-growth-taskforce

5
Getting Our Transport Network Ready: The high-end skills needed for HS2, in areas
like digital engineering and technology, will
Creating connections, bringing people and also be applicable to other industries. Our
businesses closer together, is what will enable recommendations call on the Government
the major economic benefits of HS2. The to make railway engineering and advanced
whole country, and particularly the city regions construction skills a national priority. We
north of Birmingham, must benefit from a require a long-term pipeline of skilled people
reliable, high capacity and well-connected and the younger generation will need both
transport network with HS2 at its heart. Our good information and the right educational
recommendations call on city regions both routes if they are to take advantage of the
on and off the HS2 route to make detailed, potential opportunities.
long-term, local and regional transport plans
that fully consider HS2 opportunities. Local Getting Our Businesses Ready:
authorities, LEPs, local partners and central
government must collaborate to make the right There is a great opportunity for businesses
investments happen, and the Government must across the UK to win contracts on HS2 and we
clearly communicate its plans and ambitions need to make sure the right conditions are
for the rest of our railways post-HS2. Future in place to support and harness innovation.
decisions on investment need to be informed We call on HS2 Ltd to set new standards
by thorough examinations of economic growth for industry engagement and collaborative
potential in each possible location. working, and on businesses to seize the
opportunities available, supported by local
Getting Our People Ready: authorities and LEPs.

We need to make sure we equip the UK We look forward to the Government’s response to
workforce with the right skills both to the challenge that we have laid down.
build HS2 and to support the UK’s future
competitiveness.

6
Our Recommendations

Getting our cities ready:

We have found Our recommendations

HS2 stations, and the land For each HS2 station there needs to be established an ‘HS2
around them, offer a canvas Growth Strategy’ by the end of 2014 to explain how high speed
1 for urban regeneration to rail will generate local jobs, growth and regeneration.
transform our cities.

Successful regeneration To deliver these HS2 Growth Strategies local authorities need
projects have dedicated to establish a locally led delivery body by the end of 2014.
2 delivery bodies. The Government should support them in bringing forward
regeneration.

A “business as usual” approach The Government should partner local authorities in the
to regeneration around HS2 development and delivery of HS2 Growth Strategies. The
3 stations risks cities failing to Government should also establish a central delivery body to
capture the benefits of HS2. provide coordination and support to local areas.

Strong leadership is key The Government should appoint a Minister with responsibility
to delivering successful for HS2-related economic growth and regeneration.
4 regeneration around HS2
stations.

7
 Getting our transport network ready:
We have found Our recommendations

5 HS2 should be at the heart of Work to include detailed consideration of HS2 in existing Local
an effective transport network Plans and Strategic Economic Plans should be well underway
which spreads the economic by the end of 2014, including relevant aspects of the HS2
benefits of the project as Growth Strategy.
widely as possible between
our city regions.

6 Some strategic benefits from Collaboration across organisations and administrative

HS2 will only be achieved if boundaries must be strengthened to support transport
city regions collaborate better. planning around HS2.

7 There is growing awareness, The Government and Network Rail should set out by the end of
but little certainty, of the 2014 their plan for defining how HS2 will affect rail services for
transformational impact HS2 cities off the HS2 route and for rail freight, and also their plans
will have on railway services for a wider review of rail services.
across the country.

8 HS2 offers significant growth The Government should invite the rail freight industry to set
opportunities to the rail out how it could take advantage of the capacity released by
freight industry. HS2. Separately, the Government should evaluate the case
for future-proofing HS2 to accommodate freight traffic and
communicate its plans to do this.

9 It is important that we The Government must complete as soon as possible, and act
have the best possible upon, the review of how its transport appraisal methodology
understanding of the quantifies economic benefits. It should set out its plan and
economic impacts of major timetable for this work by the end of 2014. The Government
transport projects, including should apply any revisions to its approach to any future
HS2. extensions to HS2, alongside greater and earlier local
engagement to understand local economic impacts.

10 Station location is critical The Government’s decisions on Phase Two station locations
to maximising the benefits should be informed by a thorough examination of economic
of HS2. We must learn the growth potential in each proposed station location.
lessons of other high speed
rail projects to ensure we take
the right decisions.

8
 Getting our people ready:
We have found Our recommendations

11 We already have a shortage The Government must make growing the railway engineering
of rail engineers. We need to and advanced construction skills base a national priority and
grow the skills necessary to set out how the planned HS2 Skills College will contribute to
run our current railways and this by the end of 2014.
also to build, maintain and
operate HS2.

12 University Technical Colleges HS2 Ltd and University Technical Colleges, supported by
have been very successful, but the Government, should put in place specific HS2 links and
there remains an unwarranted curriculum options.
belief that vocational learning
is “second-best”.

13 Railways have an image The Government, HS2 Ltd and industry need to develop an HS2
problem. Many people lack out-reach programme by mid-2015, formally linked into the
understanding of modern-day education system.
engineering, and parents and
children do not understand
that HS2 will open up
opportunities for well-paid
careers.

14 HS2 has the potential to set a HS2 Ltd should design a procurement process which
new benchmark for the quality requires suppliers to meet the highest standards in terms of
of skills development and apprenticeships, job creation and skills development and set
careers prospects it provides. out its approach by autumn 2014.

15 HS2 should provide access The Government and local authorities need to work together to
to jobs and training for local agree and put in place new local models to link workforces to
people. potential HS2 job opportunities.

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10
 Getting our businesses ready:
We have found Our recommendations

16 There are huge opportunities HS2 Ltd should set new standards for industry engagement and
for UK businesses to win open procurement. Its procurement strategy should require
contracts for the design and main contractors to use open procurement tools to advertise
construction of HS2. The HS2 opportunities and the process should be streamlined
procurement process must where possible to ensure there are no barriers for small
not create barriers for smaller businesses.
businesses.

17 Businesses across the UK LEPs and local authorities should target businesses in their
should engage actively with areas and set up dedicated advice and support centres to help
HS2, but need support from them get ready for HS2.
their local areas.

18 There is great innovation to be HS2 Ltd should make HS2 an exemplar project for collaborative
found in UK companies and working across businesses to drive innovation and achieve
we need the right structures excellence in delivery.
to harness this for HS2.

19 HS2 should be a rewarding HS2 Ltd must ensure strong working relationships with its
place to work, with good contractors and workforces to deliver exceptional results. It
industrial relations which should start discussions with employers and trade unions by
support efficient delivery. the end of 2014 to agree a framework to deliver high standards
in working practices and skills development.

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Getting Our Cities Ready

We believe HS2 will improve the competitiveness of our major cities, but
particularly in the Midlands and the North. It will enable them to compete
with cities around the world. This is good for those cities which will have HS2
stations and for the nation’s economy.

We have heard from civic - and business-leaders about the practical steps they
think need to be taken now to prepare their cities and maximise the economic
and social benefits from HS2. HS2 stations could have a transformational
impact but only if local and national government break the mould of
“business as usual”.

Around HS2 stations, we must develop a way of working that doesn’t rely on
separate funding streams, short term budget cycles, or complex governance
structures. This will require local authorities to develop dedicated HS2 Growth
Strategies, make fast progress, bring forward construction, and provide strong
local leadership. Above all, it will need a sharp focus on delivery. It will require
the Government to support local areas to deliver growth and regeneration
around HS2 stations.

Recommendation 1: For each HS2 station an ‘HS2 Growth Strategy’

needs to be established by the end of 2014 to explain how high speed
rail will generate local jobs, growth and regeneration.

Creating opportunities for economic

growth
In our initial report we asked what conditions However, to achieve success, progress would need
needed to be in place to extract economic and to be made on some critical issues; having proper
social benefits from HS2 stations. Each local connectivity into and out of HS2 stations; greater
authority we asked said it had already developed collaboration between existing funding streams
a vision about how HS2 would transform the area. and longer term certainty; and the stations being
integrated into the cities and surrounding areas.
This, said the cities, would help them to attract
inward investment.

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 Maximising the regional growth and regeneration benefits of HS2

We commissioned research to help us understand the scale of the

challenge. The research from Atkins2 found that most local authorities have
strategic visions for how HS2 could stimulate local economic growth, but
few have developed specific, evidenced HS2 plans. The report’s findings
lead us to conclude;

• Local areas are aware of the growth opportunities around HS2 stations,
but they do not yet fully understand what local infrastructure or funding
and delivery mechanisms will be required. Local areas are also finding it
hard to align funding to support HS2-related growth.

• Even the very best authorities will be stretched to manage a project

as complex and large as HS2, particularly when there are other
infrastructure plans being proposed (such as the Northern Hub3) that
will also have local impacts.

• Regeneration and development around HS2 stations need to be

accelerated and delivered well before HS2 arrives, to ensure stations are
designed to facilitate the flow of people and transport links. This should
be planned and coordinated to minimise disruption and delay.

• Given the complexity of governance and delivery structures operating

simultaneously in each place, a single dedicated partnership
arrangement is needed for each HS2 station site.

2
Atkins, Maximising the Growth and Regeneration Benefits of HS2, March 2014
3
The Northern Hub is a programme of targeted upgrades to the railway in the North of England. Scheduled to complete in 2019,
it will allow up to 700 more trains to run each day and provide space for 44 million more passengers a year. For more information
visit Network Rail’s website; http://www.networkrail.co.uk/improvements/northern-hub/

13
Developing strategies for growth HS2 Growth Strategies should:
and regeneration around HS2 • Identify the regeneration, development
stations and growth potential around the HS2
station. What are the benefits in terms of
Some local authorities are beginning to grapple jobs and growth? What are the impacts on
with these issues head-on, like Birmingham, land values, business rates and tax receipts?
which announced its Masterplan for the Curzon How will early investment boost local and
street station in February 20144. But there is a gap national economic productivity? What are
generally between where local authorities are the costs and benefits of bringing forward
now, and where they need to get to in terms of development?
governance, integration of HS2 stations into Local
• Assess local infrastructure needs. What
Plans and funded delivery plans. As Atkins found,
physical and social infrastructure is required
not all of the local authorities which will have HS2
(e.g. housing and skills)? What are the
stations have previously delivered regeneration
connectivity requirements? How much will
schemes on the scale HS2 opens up.
it all cost? When will they be delivered?

Time is of the essence. Local authorities need • Identify funding. How can existing local
to get started now, scoping out the physical funding sources be used to deliver the
and social infrastructure required to kick infrastructure? How will regeneration
start regeneration and development around and development impact on local land
HS2 stations. They should identify how these values? What is the potential for private
investments will be delivered. In order to justify investment? What tests would need to be
investment, they should also explain the potential met to justify upfront investment?
for economic growth around these sites. We think
• Inform existing plans. What implications
this work should be brought together into locally
will HS2 Growth Strategies have on locally
owned ‘HS2 Growth Strategies’. These strategies
owned Master Plans, Local Plans and
should be published by the end of 2014.
Strategic Economic Plans? What is needed
to join these plans up and avoid HS2 being
seen in isolation from the wider geography
around them?
• Be clear about how risks will be
managed. Will risk be transferred or shared
with investors in HS2 sites? Will it be shared
risk between central and local government?
• Set out the role of a locally owned HS2
delivery body. What form will it take?
Will locally led bodies provide leadership,
support decision-making across local
and national organisations, have the
powers needed to drive delivery (and
be accountable for their use), address
operational issues (like building capacity in
the supply chain) and accelerate delivery?

4
The Birmingham Curzon HS2 Draft Masterplan sets out how the proposed HS2 railway will enhance the city’s national rail
connectivity, accelerate its economic growth potential and unlock major regeneration sites. http://www.birmingham.gov.uk/
birminghamcurzonhs2

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Recommendation 2: To deliver these HS2 Growth Strategies local
authorities need to establish a locally led delivery body by the end
of 2014. The Government should support them in bringing forward
regeneration.

Maintaining a focus on delivery

We think every city which will have an HS2 station These bodies should, like the Mayoral Development
should establish a locally owned delivery body Corporation for Old Oak Common6, bring together
that can combine local authority planning powers local authorities, HS2 Ltd, local businesses and
and accountability with expertise. As international private investors – amongst others – to deliver
examples show us, a strong delivery body, such as development.
seen in Bordeaux’s Public Development Agency,
can help provide the right climate for investment5.

Old Oak Common and the Mayoral Development Corporation

– a model for locally owned regeneration and delivery bodies
Old Oak Common is the largest strategic development and transport
investment opportunity in West London. ‘Old Oak – A Vision for the
Future’ set out the ambition and was the subject of public consultation
between June and September 2013.
The Mayor has announced he will set up a Mayoral Development
Corporation (MDC) for Old Oak Common to coordinate and lead the
planned regeneration of the area. The MDC will assume planning
powers for the area, assemble land, liaise with developers and secure
regeneration within its area. In doing so, the MDC can emulate the
success of the London Legacy Development Corporation, which
continues to lead the post-Olympic regeneration of Stratford.

5
The Independent Transport Commission report “Capturing the Opportunity” notes that “the economic and spatial effects of
this capacity release are likely to have a greater positive benefit than time-savings from faster trains.” [http://www.theitc.org.uk/
docs/108.pdf ]
6
The Mayor has made a number of announcements in relation to these development plans, see for example: https://www.
london.gov.uk/media/mayor-press-releases/2013/12/sports-stadium-could-be-catalyst-for-transformation-of-old-oak. A local
authority perspective is available here: http://www.lbhf.gov.uk/Directory/News/Sports_stadium_could_lead_the_way_in_Old_
Oak_transformation.asp)

15
Integrating HS2 stations into their
surrounding areas
Another key function of local delivery bodies
should be to inform the station design and
ensure its integration into the surrounding area.
This is essential if these stations are to unlock
regeneration and development potential.
Not getting this right risks creating physical barriers
and blocking regeneration. This is true for both the
station and the route. The last kilometre will matter
the most!

Cordoba
Cordoba station is now a crucial interchange between Madrid, Malaga and
Seville on the Spanish rail network. Historically, the conventional railway
station and track acted as a barrier between the east and western parts of
the city, splitting it into two. Discussions about how to remove the physical
barrier this created had been on-going since the 1960s, but the arrival of
high speed rail transformed the design of the station. The stations and
the areas around the railway are now integrated into the urban centre,
attracting businesses, and creating a more vibrant hub.

16
 Recommendation 3: The Government should partner local
authorities in the development and delivery of HS2 Growth
Strategies. The Government should also establish a central
delivery body to provide coordination and support nationally.

Bringing developments forward to We also help increase certainty, which will attract
investors. To achieve this, the Government needs
capture increases in land value to help local authorities assemble land and
prepare for construction earlier and, in doing so,
The Government needs to be a partner in helping help capture the increased value in land prices.
local areas to develop and deliver their HS2 Growth We are concerned that without this support, local
Strategies. These strategies will help local partners authorities may not fully deliver a site’s economic
and the Government to better understand the growth potential for a number of reasons; a lack of
opportunities around HS2 stations sites. The resources or experience; local political factors; or
Government should support local authorities in poor relationships with developers
bringing forward regeneration and development and landowners.
as soon as practicable. The Taskforce believes these
plans need to be acted on quickly, as capturing
We think the Government should help local
the fullest economic benefits from HS2 will require
authorities to make swift progress by urgently
early investment.
setting out what costs will fall within the budget
for the HS2 railway. That way local authorities will
Acting quickly means getting onto the front be able to reprioritise their existing resources and
foot, being able to assemble land before prices identify how their HS2 Growth Strategies (and
increase, reducing the time spent constructing HS2-related transport investments) will be funded.
new developments and minimising what would
otherwise be avoidable blight around HS2 stations.

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A central delivery body • Ensuring integration of the HS2 station
into the city and the wider transport
The Government should also establish a central network; and
delivery body to support locally led delivery bodies.
We do not think it is feasible for local areas to • Helping to identify sources of investment,
maximise the economic impact of HS2 without the including from overseas.
offer of support from a central body. The role of a
central body could include: We recognise that the nature of this support will
vary depending on local circumstances, experience
• Helping to develop and implement HS2 and readiness7. But we envisage it supporting local
Growth Strategies; delivery bodies achieve their objectives and reflect
local views, rather than impose solutions.
• Offering expertise on commercial and
investment opportunities;

Funding
Regeneration and development comes at a cost. However the Taskforce
is not saying that the cost of developing HS2 should increase.
Future investment in local areas needs to be carefully targeted and
prioritised in order to maximise the vast economic growth that HS2
can offer. The development of comprehensive, locally led HS2 growth
strategies for each area will be the key starting point. Only when local areas
know what they want to deliver, and the costs and benefits involved, can
investment opportunities for meeting the cost be properly explored.
We think existing funding that supports local growth can be better aligned
to support HS2 growth strategies. This includes both central funding (such
as the Local Growth Fund and existing funding streams) and local funding
(such as retained business rates). There is also great potential for the private
sector to exploit the obvious commercial opportunities that HS2 brings
and drive regeneration and development.
Government should be an active participant in discussions with local
authorities about their HS2 growth strategies8 – helping to explore the
different options for financing of those plans – to support and enable local
areas to successfully realise their visions.

7
Atkins, Maximising the Growth and Regeneration Benefits of HS2, March 2014
8
Atkins, Maximising the regional growth and regeneration benefits of HS2, March 2014

18
 Recommendation 4: The Government should appoint a Minister
with responsibility for HS2-related economic growth and
regeneration.

The importance of strong and

effective leadership
Everywhere we went, we heard from local We would like to challenge the Government
leaders what they were doing to help their to demonstrate similar leadership. As was so
communities grasp that HS2 is more than a successful with the Olympic and Paralympic Games,
railway. In Manchester, consultation to inform a we want a dedicated Minister to be appointed to
multi-billion pound investment around Piccadilly lead regeneration and development around HS2
station has already been conducted9. This sets at the national level. They should be supported by
out a local vision for the area and identifies the a team that has the capacity and skills to support
opportunities to generate more jobs and create local authorities in negotiating their way around
more new housing. Whitehall and in developing and delivering HS2
Growth Strategies.

Olympics and Paralympics

Strong and visible political leadership was vital in making the case for
the Olympic Games in the early years when opinion was still divided. A
new Ministerial position was created to foster support for the project
based on the wider opportunities it offered to regenerate East London.
This Minister provided national leadership while the London Mayor
provided local leadership. Together they drove forward land purchasing
and sourced funding. This national leadership model was mirrored in the
way individual teams were brought together by governance and delivery
structures (such as the Olympic Delivery Authority). This paved the way
for a longer term legacy and to continue the regeneration of Stratford
and its surrounding areas.

9
The draft master plan, setting out how Manchester Piccadilly Station would be revamped in preparation for both the
Northern Hub and HS2, was published in August 2013 http://www.manchester.gov.uk/mwg-internal/de5fs23hu73ds/
progress?id=j2pQODZJO8

19
Getting Our Transport Network Ready

Creating connections – bringing people and businesses closer together

– is what will enable the major economic benefits of HS2. In this chapter
we challenge local and national bodies to appraise the city and regional
growth potential, to plan effectively and to integrate HS2 into our
transport networks to benefit communities on and off the route.
We know that there is a strong, positive relationship between better
connections and economic performance. We also know that the full
impact of HS2 on the UK economy will depend on a number of wider
factors10. So whilst being better connected creates a more attractive
environment for all sorts of inward investment, having the right business
environment to attract such investment is important too. This is why it is
crucial that local areas are able to plan effectively for the arrival of HS2.

Recommendation 5: Work to include detailed consideration of

HS2 in existing Local Plans and Strategic Economic Plans should
be well underway by the end of 2014, including relevant aspects
of the HS2 Growth Strategy.

Planning our transport networks act now to examine thoroughly how they will
integrate HS2 into existing local and regional
for HS2 transport networks.
One of the overriding messages we’ve heard from
We didn’t hear this message solely from those
local leaders is that HS2 offers great potential to
places with a proposed station. It was loud and
promote balanced and widespread growth – but it
clear from places that could benefit from capacity
will not work in isolation. We must connect HS2 (and
released on our existing network from services
the areas that it helps to prosper), to the places where
running from the high speed lines. Liverpool’s
people live and work. This will mean making HS2
leaders, for example, were excited to set out how
stations strategic nodes that connect international,
the additional rail capacity from HS2 could support
inter-city, regional and intra-city transport.
an expansion of the city’s port. Places like Liverpool,
Newcastle, Warrington, Chester, Holyhead, Bangor,
The focus from the Government and HS2 Ltd has,
Derby, Nottingham, Leicester, Stoke, Stafford and
rightly, been on the HS2 route and its stations.
Milton Keynes (to name but a few), should all plan
That focus will be too narrow in the future. The
for the opportunities that HS2 will create.
Government, HS2 Ltd and local authorities must
10
HS2 Ltd: Literature review on the economic benefits of transport investment – implications for HS2, March 2014
http://assets.hs2.org.uk/sites/default/files/inserts/Literature%20review.pdf

20
 Connecting HS2
Sir David Higgins’ report looked at the importance of Crewe in unlocking
early benefits to the North11. Crewe is ideally placed to act as a hub station
and connect HS2 into the surrounding regions. Its strategic importance was
recognised by the old London and North Western Railway, which identified that
it was the optimal place to build a major junction.
The extra capacity released by HS2 provides an opportunity to reconfigure
services and better utilise the strategic location of Crewe to serve major centres
in the North West such as Liverpool, Warrington and Chester, and also Stoke,
Stafford and all the local stations which form part of the commute into the
bigger cities, supporting regeneration in the process.
Crewe is also a natural gateway to North Wales. Additional connectivity at
Crewe into North Wales supports the proposed strategic European freight
corridor through to Dublin via Holyhead. This helps to unlock investment
in North Wales’s growing advanced manufacturing sector, including: the
Energy Island Programme and Enterprise Zone developments; the £10 billion
project for the Wylfa Newydd power station on Anglesey; Siemens Tidal Array
Generation project; the new Menai Science Park; and major developments at
the Deeside Advanced Manufacturing Enterprise Zone.

We believe that all local authorities and Local feature both in the local authority-owned HS2
Enterprise Partnerships12 (LEPs) touched by HS2 – Growth Strategy (discussed in the previous chapter)
whether directly or indirectly – should challenge and the relevant Local Plan13.
themselves to think about how it will act as a
catalyst for development and growth across their HS2 – and connectivity – should also feature
city regions. Detailed and long-term planning strongly in the Strategic Economic Plans (SEPs) that
across all forms of transport – with HS2 at its heart are devised by LEPs and form the basis for bids to
– will be crucial. We believe detailed connectivity the Local Growth Fund14.
planning (with locally defined borders) should

11
Sir Davis Higgins’ report “HS2 Plus” is available here: http://www.hs2.org.uk/david-higgins-launches-his-vision-for-hs2
12
Local Plans are a local authority’s vision for their area over a 15 year time horizon. Informed by business and economic needs,
they cover issues like housing, infrastructure, retail, leisure and commercial development. Once formally adopted they have a
statutory footing and there is a duty for all public bodies to co-operate over issues that cross boundaries.
13
Local Enterprise Partnerships are non-statutory bodies, formed at Government invitation in 2010 to bring local business and
civic leaders together to provide the vision and leadership to drive sustainable economic growth and create the conditions to
increase private sector jobs in their areas.
14
From 2015 the Local Growth Fund will be the main vehicle for funding local connectivity investments, including connectivity
improvements to support HS2. LEPs must compete for ‘Growth Deal’ funding from an annual £2 billion single pot, using the
evidence developed in their Strategic Economic Plans, which must be submitted by 31 March 2014.

21
 Plan owned by the Local Enterprise Partnership (LEP). This can apply to areas without HS2 stations.

Within the LEP we have...

Other LEPs

But the HS2

Local
Growth Strategy
businesses needs input from...
HS2 Ltd
Council A Council B

Council C Council D
Other
public Possible
bodies investors

Ongoing Central
discussion Government

Local authorities and LEPs should keep all of their Strategies and Local Plans should stand the best
plans aligned, as together they should form a chance of attracting funding for priority local
coherent vision for the wider area. For example, transport projects. We have been impressed by
bids by LEPs that take full account of the detailed, those local authority and LEP leaders that have
cross-transport connectivity plans in HS2 Growth already begun taking on these challenges.

Local leadership
The East West Rail Consortium was formed in 1995 with the objective of
re-establishing a rail link between Cambridge and Oxford and improving
rail services between East Anglia, Central and Southern England.
Independent research forecasts that this scheme will generate around
12,000 new jobs and boost regional GDP by £38 million per annum.
The Consortium brings together eight local authorities, railway and
regional stakeholders, local businesses and private sector partners,
under a single Chair. Strong local leadership, knowledge of the route and
determination to improve the economic prospects of their area have been
critical to gaining approval for the scheme.
Local leaders have credited their success to the Consortium’s
single-minded determination in establishing a robustly evidenced business
case to improve transport connections within the region and nationally.

22
 Recommendation 6: Collaboration across organisations and
administrative boundaries must be strengthened to support
transport planning around HS2.

Collaboration to strengthen
outcomes
A collaborative approach to planning and sharing We would welcome the inclusion of this as a
information across organisations and geographical desirable criterion in any future assessment of
boundaries will be crucial. Those city regions Strategic Economic Plans. As well as co-ordinating
that take a strategic local and regional approach between themselves, LEPs should also lead in
– such as combined authorities15, which allow sharing information and emerging HS2-related
their participants to develop transport plans as a transport plans with central bodies. Bodies such as
fundamental part of integrated growth strategies the Department for Transport, HS2 Ltd, Network
for their areas – will be best placed to deliver HS2 Rail and the Highways Agency should stand ready
connectivity to passengers on time and on budget. to support LEPs in developing and refining these
plans, sharing any relevant information. Whilst
We think LEPs have a key role to play. But we some areas such as Greater Manchester have
have heard from LEP leaders themselves that already been proactive in setting up this kind of
inter-LEP engagement is patchy, and often relies engagement, other areas need to follow their lead.
on individuals’ personal connections more than
structured engagement16. The best LEP leaders see The Government is currently considering
benefits in engaging with their counterparts to consultation responses on the proposed Phase Two
share mutually-relevant plans and ideas. station locations. Once it has made these decisions,
LEPs should be given the flexibility to revisit the
We believe that the wide and overlapping detail of existing Growth Deals where the station
gravitational pull of major city regions calls for location has an impact. The Government should
more joint working between LEPs to achieve provide clarity to LEPs on this process, and on any
their strategic transport goals for linkages to future process beyond this year. For future Growth
HS2. We would therefore like to see Strategic Deals, the Government should support LEPs to
Economic Plans establish cross-references update the investment proposals contained within
between themselves so that they can support their Strategic Economic Plans based on the detail
joint investment by different LEPs in strategic of HS2 Growth Strategies. This will enable areas
transport projects that drive growth across affected by Phase Two to take account of HS2 as a
wider areas of the country. key driver of growth.

15
A Combined Authority is a statutory body established by a group of local authorities who propose a pooling of responsibility
and certain functions (minimally transport and economic development) in order to deliver growth more effectively over a wider,
normally city region, area.
16
Atkins, Maximising the Growth and Regeneration Benefits of HS2, March 2014

23
 Recommendation 7: The Government and Network Rail should
set out by the end of 2014 their plan for defining how HS2 will
affect rail services for cities off the HS2 route and for rail freight,
and also their plans for a wider review of rail services.

HS2 and the rest of our railways

We have received a clear message from local We recommend the Government sets out, by the
leaders about the far-reaching and positive impacts end of 2014, its plan and timescales for defining
HS2 could have on the rest of our railways. Some how the post-HS2 network will work. We urge the
places expect to experience faster and more Government and Network Rail to engage local
efficient services thanks to ‘classic compatible’ trains areas in how released capacity should be used.
running from the HS2 network onto existing lines. The Government and Network Rail should provide
Others could see improved regional and commuter an update on any work and produce its findings
services as a result of capacity freed up by HS2, with (e.g. potential options for service patterns, capacity,
potential for significant economic impacts17. connections and frequencies) as soon as possible.
And, in the same way as decisions on infrastructure
Individual places are anxious to see whether and investments are made, the Government should
how they will benefit. So far the Government has prioritise economic performance – hand in hand
only been able to offer broad assumptions about with affordability – in the future design of rail
loss or gain of services18. If cities and businesses are services.
to make the most of released capacity to support
economic growth and city regeneration, they need Overall, we think that both the Government
to know what to expect in terms of the nature and Network Rail should be far more ambitious
and frequency of rail connections – and they need in their thinking about how HS2 will transform
to know in time to plan and deliver investment, our rail network, rail franchises, passenger and
development or services19. We recognise that this is freight services, and open up new commercial
an enormously complex task. opportunities. We are pleased to see Sir David
Higgins recognising this in his report.

European experience teaches us that developing

a view of the future evolution of our railway
with HS2 will be crucial to extracting maximum
benefit20. We recommend that before the end of
2014 the Government publicly communicates its
plans to exploit these opportunities and begins
work as soon as possible. Doing so will enable HS2
to act as a catalyst for a better rail network across
the whole country.

24
 Recommendation 8: The Government should invite the rail freight industry
to set out how it could take advantage of the capacity released by HS2.
Separately, the Government should evaluate the case for future-proofing
HS2 to accommodate freight traffic and communicate its plans to do this.

HS2 and rail freight

As well as benefits for passengers, capacity released The rail freight industry has also expressed an
on the main network by HS2 will help tackle some interest in using high speed lines for freight
of the pinch-points across the network that hold up services. This is a complex area, but we recognise
freight movement. This will open up opportunities the potential benefits. The experience of Eurostar
to help our rail freight industry grow. In its Strategic teaches us that light freight using suitable rolling
Case21, the Government estimated that HS2 could stock can travel on high speed rail. Any affordable
provide space for an extra twenty paths for freight opportunity should be explored. We recommend
on the West Coast Main Line alone to help to that the Government evaluate the case for future-
meet growing demand22. By allocating capacity to proofing HS2 to accommodate freight traffic and
rail freight services, HS2 could take 500,000 HGV publicly communicate its plans to do this.
lorry journeys off our major motorways each year,
boosting the economy by £45 million annually23.

The Government should invite the rail-freight

industry to set out how it could take advantage
of released capacity on the existing rail network.
Once the industry has put forward its case, the
Government and Network Rail can then decide
how to balance additional passenger services with
additional freight services. In addition, the rail
freight industry should engage with relevant LEPs
so it can be involved in local transport planning
negotiations.

17
The Independent Transport Commission report “Capturing the Opportunity” notes that “the economic and spatial effects of
this capacity release are likely to have a greater positive benefit than time-savings from faster trains.” [http://www.theitc.org.uk/
docs/108.pdf ]
18
Network Rail, Better Connections: Options for the Integration of High Speed 2, August 2013, http://www.networkrail.co.uk/
improvements/high-speed-rail/
19
Atkins, Maximising the Growth and Regeneration Benefits of HS2, March 2014
20
Independent Transport Commission, Capturing the Value of High Speed Rail, Learning from Europe: The Lille Symposium 2014,
March 2014, http://www.theitc.org.uk/docs/115.pdf
21
The HS2 Strategic Case, published by DfT in 2013, https://www.gov.uk/government/publications/hs2-strategic-case
22
Rail freight is forecast to grow 2.9% year on year to 2043 and is increasingly shifting from bulk goods (e.g. coal and aggregate)
to fast moving consumer goods (forecast to grow at 6% pa to 2043). (Network Rail, Long Term Planning Process: Freight Market
Study, October 2013).
23
WSP Group, http://www.wspgroup.com/en/WSP-UK/Who-we-are/Newsroom/News-releases1/2013/hs2-could-save-carbon-
and-money-in-increased-freight-capacity/

25
 Recommendation 9: The Government must complete as soon as possible,
and act upon, the review of how its transport appraisal methodology
quantifies economic benefits. It should set out its plan and timetable for
this work by the end of 2014. The Government should apply any revisions to
its approach to any future extensions to HS2, alongside greater and earlier
local engagement to understand local economic impacts.

Appraising major transport

investments
There is increasing debate over the degree to more productive “hubs”, which will undoubtedly
which it is possible to appraise robustly the fullest be elements of HS2’s local impact. Experience
economic effects of major transport schemes, such from past major transport investments, none of
as HS2. Capturing all of the potential economic which have been on the scale of HS2, tells us that
benefits to individual places and assessing what a benefit-cost ratio derived from the Department
these mean for national economic performance is for Transport’s standard approach has been overly
an ambitious aim, but we believe it should at least conservative in attributing the benefits projects
be possible for the Department for Transport’s eventually deliver to the transport intervention.
current approach to be broadened. For example, its We don’t think that the Government’s current
current approach fails to capture the full value of business case for HS2 is any different; the benefits
dynamic changes in land use, regeneration and the set out do not fully capture the ‘real prize’ HS2 offers
concentration of certain, high-value businesses into the country.

The Jubilee Line Extension

It would be impossible to imagine the economic success of an area like
Canary Wharf without the Jubilee Line Extension. But this project almost
never happened.
The Jubilee Line opened in 1979, with four kilometres of new tunnelling
through central London. An ambitious business case to extend the
line eastwards to Stratford and the Docklands was accepted by the
Government in 1989. The projected benefits were one and half times the
investment. However, by the time the associated hybrid bill had achieved
Royal Assent, changes to the design and route of the project meant that
the forecast benefits were revised down to less than the costs. The scheme
arguably only survived because of the substantial developer contributions
which were promised. The £3.5 billion project opened in December 1999
and retrospective academic studies, using standard Department for
Transport appraisal, now estimate the benefits at almost double the latter
forecast, at £1.75 of benefits for each pound spent24.

26
A number of methodologies have been developed We encourage it to produce, and act upon, the
by organisations and individuals outside of central work’s findings as soon as possible. We also believe
government, which aim to identify different ways there is room to encourage further debate. The
to appraise wider economic and societal benefits Government should engage local areas at the
from major transport investments. This is an start of any assessment to understand the local
evolving area of work. KPMG recently contributed impact of a proposed transport scheme. It must use
their attempt to estimate the regional benefits information from local areas to produce credible
of HS225. Separately the Royal Town Planning judgements of potential growth at the local and
Institute has reinforced the need for an improved national level.
approach, saying that “policy-makers need to
deliver a visionary narrative of the real benefits that Any revised appraisal should be applied to future
transport infrastructure-led schemes will make...” 26 decisions on whether and how to extend the high-
speed rail network, for example, to Scotland28.
We endorse the Government’s on-going Given the Government’s express interest in creating
participation in this debate and its work27 to a truly national network, we urge the Government
look at whether it is possible to devise tools to to ensure that the design of Phase Two does not
overcome the limitations in its current approach. create undue barriers to further extension.

24
OMEGA Centre, University College London, Project Profile : Jubilee Line Extension, 2009 http://www.omegacentre.bartlett.ucl.
ac.uk/studies/cases/pdf/UK_JLE_PROFILE_120909.pdf
25
KPMG, High Speed Two (HS2) Limited, HS2 Regional Economic Impacts, 2013 http://www.kpmg.com/UK/en/
IssuesAndInsights/ArticlesPublications/Documents/PDF/Market Sector/Building and Construction/hs2-regional-economic-
impacts.pdf
26
RTPI, Transport Infrastructure Investment: Capturing the Wider Benefits of Investment in Transport Infrastructure, 2014 http://
www.rtpi.org.uk/media/816110/capturing_the_wider_benefits.pdf
27
DfT, Understanding and Valuing the Impacts of Transport Investment, 2013 https://www.gov.uk/government/uploads/system/
uploads/attachment_data/file/253860/understanding-valuing-impacts-transport-investment.pdf
28
On 1 November 2013 the Government announced work to look at the broad options for improving journey times and capacity
north of the Y network and to Scotland, https://www.gov.uk/government/news/next-phase-of-work-for-high-speed-2-and-
scotland.

27
 Recommendation 10: The Government’s decisions on Phase Two
station locations should be informed by a thorough examination
of economic growth potential in each proposed station location.

Economic potential of Phase Two

station locations
If we are to truly help our cities to achieve their multi-modal access to and from stations is a
economic potential, we need to ensure that HS2 major factor of success29. Both Lyon and Lille
stations are located (and designed), to maximise have reaped the benefits of transforming
economic growth. their high-speed rail stations into the main
hub of the urban transport system30. Equally,
Choices between city centre, hub or parkway out of town stations with good connectivity,
stations are hugely important. Each potential like Germany’s Montabaur, can be successful
location is unique and will offer different too. But stations with poor public transport
opportunities according to its specific economic connectivity to urban areas, such as TGV-Haute
and logistical characteristics. We believe there is Picardie, Le Cruesot and TGV-Lorraine, have
no ‘one size fits all’ solution and each HS2 Growth demonstrated poor local economic impacts31.
Strategy will need to reflect the opportunities • The nature of the local economy and
which its location affords. opportunities.
High speed rail services can have the greatest
We strongly recommend that the Government, in impact in service sector-led areas where the
making decisions on Phase Two station locations, extra connectivity becomes an enabler for
should undertake a thorough examination of local economic growth32. It makes sense to locate
evidence to assess economic growth potential in HS2 stations near places that offer the greatest
each possible location. Analytical contributions opportunities for regeneration and growth.
from local areas on growth potential should be
scrutinised and taken into account where possible. • Accelerating delivery of local plans.
HS2 stations can act as a multiplier or
Important factors for the Government to consider accelerator of local development plans. The
will include: strength of the local vision, and the readiness
of a local authority to seize this opportunity,
• Opportunities for local connectivity. need to be considered alongside the potential
International examples demonstrate that of any particular site.

29
 S2 Ltd: High Speed Rail - International Case Studies Review, March 2014
H
http://assets.hs2.org.uk/sites/default/files/inserts/International%20case%20studies%20review.pdf
30
HS2 Ltd: High Speed Rail - International Case Studies Review, March 2014
http://assets.hs2.org.uk/sites/default/files/inserts/International%20case%20studies%20review.pdf
31
HS2 Ltd: High Speed Rail - International Case Studies Review, March 2014
http://assets.hs2.org.uk/sites/default/files/inserts/International%20case%20studies%20review.pdf
32
HS2 Ltd: High Speed Rail - International Case Studies Review, March 2014
http://assets.hs2.org.uk/sites/default/files/inserts/International%20case%20studies%20review.pdf

28
29
Getting Our People Ready

Getting our people ready for HS2 is an intrinsic part of maximising its
impact. We want to make sure we have the right workforce in the UK to
build, run and maintain HS2 and that jobs are spread throughout the
economy. We need to up-skill and grow our rail and construction workforces
so that we can be confident of having a pipeline of the right people with the
right skills both now and in the future. Through HS2, we also need to make
our young people, their parents, schools and colleges aware of the careers
available in rail engineering and advanced construction. The high-end skills
in digital engineering and technology that will be needed for HS2 will also
be highly transferable to other industries; in this way, HS2 can be a platform
to support the UK’s engineering renaissance and boost our international
competitiveness and reputation.

Recommendation 11: The Government must make growing the

railway engineering and advanced construction skills base a
national priority and set out how the planned HS2 Skills College
will contribute to this.

Bridging the skills gap

The National Skills Academy for Railway Some initiatives are already underway to address
Engineering (NSARE) has published research33 rail skills gaps, notably through NSARE’s work with
showing that we do not have enough people with industry. The new National Training Academy for
the right skills in railway engineering. This is a risk Traction and Rolling Stock is an example of this. The
to planned railway infrastructure projects and Government needs both to learn from this work
orders for new trains over for the next five years. and build on it.
HS2 will make the challenge even more acute.

33
Forecasting the Skills Challenge”, http://www.gmedia.uk.com/PDFs/NSARE_Forecasting%20the%20Skills%20Challenge_Janu-
ary%202013.pdf

30
Railway engineering: a national skills challenge
• Less than 20% of the existing workforce have a Level 4 qualification or
higher (equivalent to a certificate of higher education/HNC).
• Around 10,000 additional people are needed to deliver what is planned
on the rail network for the next five years alone.
• The current railway engineering training capability (capacity and quality)
is not sufficient for future requirements.

And the problem is set to get even worse…

• Over 40% of the workforce is 45 and over, rising to over 55% for train
building and maintenance.
• In some specialist disciplines the shortages are even more acute. We
need to grow the electrification and train building and maintenance
workforce by 40%.
• In total, around 30% of the rail workforce (around 30,000 people) will
need to learn new skills to deliver what is needed for future projects.

The HS2 dimension

HS2 Ltd has begun research to understand how the skills requirement for
HS2 fits into this picture. Initial indications show that:
• For construction, at least 50% of the jobs will require skills at
NVQ Level 3 (equivalent to ‘A’ Level) or above. The majority of our
construction workforce only has skills at level 2.
• In construction skills terms, there is an important gap in digital
engineering and off-site manufacturing techniques, which HS2 will need.
• HS2 will bring a considerable rolling stock requirement. The current and
planned UK workforce does not have capacity to manufacture the trains
for HS2.

31
These skills gaps are not confined to rail. Modern As the research shows, these skills will be needed
construction techniques like digital engineering for HS2 and they are in short supply. We must start
and Building Information Modelling (BIM) allow training more people in these skills now to meet
us to design and build infrastructure in a factory this demand. The Construction Industry Training
environment, reducing construction time by at Board (CITB) has an important role to play.
least 30%34.

These skills are highly transferable, and what The challenge is not just getting the skills base
people develop to meet the HS2 need will be right for HS2. What we do now and in the coming
valuable for other industries such as nuclear, years will help prepare the rail industry for the
aerospace and automotive. Professor John Perkins’s long term. NSARE will be a crucial partner in any
review35 has already highlighted the need to future work and whilst being relatively small in size
address engineering skills provision more broadly it has established itself as the rail industry’s ‘go-to’
and the development of people with transferable organisation for training and skills. Industry also
skills through HS2 will be of benefit to many needs to be directly involved to ensure we address
sectors, as well as to the individuals themselves. the skills gaps across the whole rail sector – not
just HS2. We think the recently formed Rail Supply

34
Data from Laing O’Rourke
35
BIS, Professor John Perkins’ Review of Engineering Skills, 2013 https://www.gov.uk/government/uploads/system/uploads/
attachment_data/file/254885/bis-13-1269-professor-john-perkins-review-of-engineering-skills.pdf

32
Group, which brings together government and • Explain what the new HS2 Skills College will
industry stakeholders, can help the Government to offer and how it will extend its presence across
achieve these objectives. Specifically, we think the the country. We believe it should be part of
Government should, by the end of 2014: a network of providers that offer a cohesive
programme of skills development with clear
• Undertake a detailed stocktake of current skills pathways to employment through direct
and skills gaps in both railway engineering and employer links. The importance of transferable
advanced construction to assess readiness for skills also needs to be recognised.
HS2, working with NSARE, CITB and industry to
make sure all the latest information is brought • Set out how its industrial strategy can help to
together in one place. address skills shortages arising from HS2. This
could include exploring the potential for a new
• Set out how it will support NSARE so that it can strategic partnership focused on rail.
properly factor HS2 into its work programme.
Throughout this work, ways in which greater
We were pleased to hear that the Government workforce diversity can be achieved must also be
intends to establish an HS2 Skills College to help considered. The UK has the lowest participation of
to address the skills gaps. However, this cannot be women in hi-tech industries in Western Europe,36
a stand-alone institution – it must work as part of for example, and skills development activity for
a skills network, bringing training opportunities high speed rail needs to explore how greater
to people across all areas of the country, for participation across under-represented groups can
both new entrants and the existing rail and be encouraged.
engineering workforce. The Government should,
by the end of 2014:

36
European Commission Eurostat, High Tech Statistics, Data from December 2013 http://epp.eurostat.ec.europa.eu/statistics_
explained/index.php/High-tech_statistics?

33
 Recommendation 12: HS2 Ltd and University Technical Colleges,
supported by the Government, should put in place specific HS2
links and curriculum options.

We need to attract more people into rail and

engineering careers to meet the HS2 skills
challenge and to do this we must tap into our
vocational education system, including University
Technical Colleges (UTCs). We should embrace
the scale of HS2 as an opportunity to promote
vocational routes more strongly and remove the
unwarranted stigma that vocational training is
‘second best’. UTCs offer a valuable route into well
paid and respected careers.

To ensure we are supporting and fully exploiting

the UTC network, the Government should
challenge HS2 Ltd and UTCs to develop curriculum
options that train more people in the skills
needed for HS2 and to establish formal links and
partnerships with the new HS2 Skills College by the
time it opens.

University Technical Colleges: using the network

University Technical Colleges are for students aged 14 to 18 and
specialise in technical studies. They are all supported by industry and
sponsored by a university. Students can either go on to a higher level
apprenticeship in employment or to university.
They provide an impetus for students who may otherwise not have
followed an engineering or technology career route and can be
an important part of giving us the skills we need for HS2. There are
currently 17 UTCs open, with a further 33 in development due to open in
2014 and beyond.

34
 Recommendation 13: The Government, HS2 Ltd and industry need
to develop an HS2 out-reach programme by mid-2015, formally
linked into the education system.

We need to engage children, their parents, schools

and FE colleges in addressing our longer term skills
challenges. HS2 is not all about greasy overalls
and hard hats; it is as much about producing
3D-modelling and using software to design
complex constructions. The Government and HS2
Ltd need to get this message across by developing
links into schools and promoting the careers that
HS2 and modern engineering can offer. There are
already examples of local good practice, but high
quality materials should be available to every
secondary school in the country to inspire the
next generation.

The Government needs to attract young people

from a diverse range of backgrounds and a
properly targeted and well thought through
outreach programme can help to deliver this. We
will not be able to maximise the potential of the
future workforce if we continue to have very low
participation levels for women in engineering,
for example.

HS2 and the Birmingham Baccalaureate

HS2 Ltd has been supporting Birmingham City Council in developing a
programme aimed at preparing local teenagers (14-15) for the work place.
In the HS2 sponsored project, students formed a project team which
evaluated four possible routes between Birmingham and London for a
proposed new high speed rail network.
HS2 Ltd has provided guidance on what the students needed to consider
when making their decisions. HS2 has proved to be a good way to
contextualise the real world of work whilst providing opportunities to build
employability skills.

35
 Recommendation 14: HS2 Ltd should design a procurement
process which requires suppliers to meet the highest standards in
terms of apprenticeships, job creation and skills development and
set out its approach by autumn 2014.

Spreading jobs throughout the Ltd an opportunity to take this a step further.
This could include setting quality standards for
economy apprenticeships as well as quantities and ensuring
key suppliers develop local capability and invest in
HS2 is big investment. Getting value for money is, their people. A requirement for direct employment,
of course, crucial, but we want to make sure that where major contractors must take staff on to their
the money is spent in a way that creates the widest payroll rather than relying on sub-contractors or
possible benefits and spreads the job opportunities freelance workers is an option to consider.
across the country.
Sustainable procurement can also help to ensure
The approach to procurement is being developed value for money and lower operational costs. We
now, with some early contracts already out to want HS2 Ltd to be ambitious in its approach to
tender. HS2 Ltd have told us that they want to environmental sustainability and the Olympics
emulate the success of projects like Crossrail and provided some useful lessons in this area38. We
make UK based jobs and apprenticeships37 a key challenge HS2 Ltd to explain how it will exceed the
feature in their contracts. These principles are outcomes achieved by previous best practice projects.
not new, but the scale of this project offers HS2

37
Government Press Release, published 6 February 2014 https://www.gov.uk/government/news/crossrail-rolling-stock-and-
depot-contract-to-be-awarded-to-bombardier
38
Department for Environment, Food & Rural Affairs and Olympic Delivery Authority, Guide: Sustainable procurement for
construction projects, 2013
https://www.gov.uk/government/publications/london-2012-legacy-sustainable-procurement-for-construction-projects

36
 Recommendation 15: The Government and local authorities
need to work together to put in place new local models to link
workforces to potential HS2 job opportunities.

HS2 has the potential to provide a wide variety of We recommend that the Government and local
jobs for a range of people across the UK. A strong authorities agree a plan to co-ordinate work
procurement approach can set up the opportunity across Job Centre Plus, the third sector, local
but to ensure these benefits are realised on the workforce representatives and other stakeholders
ground we need to find a way to link local people to link the local workforce better to potential job
quickly and efficiently to HS2 jobs. The Government opportunities. This should be reflected in HS2
needs to build on examples of local co-ordination, Growth Strategies or LEP area development plans
taking into account the wide geographical scope at least six months before job opportunities are
and scale of HS2, and taking advantage of the expected to materialise.
lead-in time available. Employability frameworks
are a model to be considered.

The Regional Employability Framework (REF) for the North East was
developed in response to the region’s high levels of unemployment.
It is a model to support individuals into sustainable employment and
increase the economic activity rate.

Promoting inter-agency co-operation and partnership working has been

fundamental to the successful implementation of the REF. It is based upon
a partnership network of regional organisations such as Jobcentre Plus,
North East Employer Coalition, Voluntary Organisations Network North
East, Public Health North East and the Alliance of Sector Skills Councils.

The DWP National Employer Service Team works with national employers
across the UK, helping to shape recruitment practices. Working in
partnership with major employers like Morrisons has led to good results in
finding opportunities for unemployed people.

37
Getting Our Businesses
Ready
HS2 offers UK businesses an opportunity to bid for contracts worth
around £25 billion39. Successful bidders will be able to make long
term investment in their capability and skills base, further driving jobs
and growth. HS2 should be our best example yet of UK businesses
successfully competing for contracts, working collaboratively and
spreading innovation through the supply chain. Businesses have to
seize the opportunities HS2 opens up and the Government must make
sure the right structures are in place to enable this. We cannot afford to
look back in five years’ time at a missed opportunity. We challenge our
businesses to get HS2 ready.

Recommendation 16: HS2 Ltd should set new standards for industry
engagement and open procurement. Its procurement strategy should
require main contractors to use open procurement tools to advertise HS2
opportunities and the process should be streamlined where possible to
ensure there are no barriers for small businesses.

Establishing the right environment HS2 Ltd has begun a programme of engagement
with potential suppliers but we think it can go
for businesses further, working with LEPs across all regions as
an exemplar of early market engagement. The
HS2 is a great opportunity for businesses big and Rail Supply Group, which brings together both
small. Initial analysis of the potential supply chain government and industry, has recently been
for HS2 gives an indication of how widespread established to strengthen the capability and
the opportunities could be, as shown on the map competitiveness of the UK rail supply chain and
opposite. HS2 Ltd should align its industry engagement work
with the work of this group.

39
The HS2 Strategic Case, published by DfT in 2013, https://www.gov.uk/government/publications/hs2-strategic-case

38
 Potential HS2
Suppliers by
Constituency

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39
Open procurement and small To ensure this occurs, we believe HS2 Ltd should
include in its procurement strategy a requirement
businesses for all direct suppliers to use CompeteFor or a
similar tool to advertise opportunities over a
Britain has around 4.8 million small and medium given threshold which have arisen as a result of
sized enterprises that excel in a range of specialist winning HS2 contracts. We are not looking to break
fields; around 890,000 operate in the construction existing supply chains, but rather to ensure that
sector.40 Small businesses in particular have new requirements arising as a consequence of the
emphasised to us the importance of being able project are advertised as widely as possible.
to access HS2 opportunities in a simple way. To
support these ambitions, open procurement tools,
HS2 Ltd should also build on best practice to
like CompeteFor41 can open up existing supply
ensure that the procurement process is as simple
chains both to ensure that opportunities are spread
as possible and streamlined to ensure that smaller
as widely as possible through the UK supply chain
businesses are not hampered in the bidding
and to drive value. HS2 can take this approach even
process. This could include measures such as
further than previous examples of good practice,
standardised pre-qualification questionnaires
like the Olympics.
or online prequalification and exploring ways
to ensure prompt payment requirements filter
through the supply chain.

40
Federation of Small Businesses, Small Business Statistics, 2013 http://www.fsb.org.uk/stats
41
CompeteFor is a free service that enables businesses to compete for contract opportunities linked to major public and private
sector buying organisations. See https://www.competefor.com/

40
Recommendation 17: LEPs and local authorities should target
businesses in their areas and set up dedicated advice and support
centres to help them to get ready for HS2.

Local authorities, LEPs and local partners should

also take steps to support local businesses to
engage with the long term opportunities HS2
offers. The support they offer could vary from
supporting businesses to comply with the
procurement requirements, to accessing the skills
and other support they will need to win contracts.
The ‘Fit for Nuclear’ programme in Sheffield is an
example of this.

We want all LEPs, supported by local authorities,

to lead work in their areas to set up advice and
support centres to help local businesses get
ready for HS2.

Business readiness – the ‘Fit for Nuclear’ programme

The ‘Fit for Nuclear’ programme delivered by Sheffield City Region’s
NAMRC (Nuclear Advanced Manufacturing Research Centre) is dedicated
to helping UK businesses become suppliers of choice to the global civil
nuclear industry. It aims to ensure businesses are ready for future growth
opportunities and to support UK companies to be ready to address future
supply chain requirements. This includes identifying potential companies
that could supply the nuclear market, supporting companies to close
capability gaps and matching company capabilities to client needs.

41
 Recommendation 18: HS2 Ltd should make HS2 an exemplar
project for collaborative working across businesses to drive
innovation and achieve excellence in delivery.

Excellence in delivery Collaborative approaches between all partners are

a factor in ensuring delivery is both on-time and
Much of the HS2 contract spend will be in on-budget. We don’t want to pretend this is an easy
technology-led areas; £4 billion in railway task. It will require a huge cultural change within
systems and around £7 billion in the design and industry – marked by a shift towards sharing more
manufacture of rolling stock. Delivering this much intellectual property and challenging traditional
technology efficiently will require innovation from ways of working. But HS2 opens up an opportunity
businesses. The best way to foster this innovation to set new standards.
within HS2 will be to develop a collaborative To make this a reality, collaborative delivery must
environment where contractors (ranging from be part of the terms and obligations placed on
small and medium sized enterprises through contractors, which HS2 Ltd need to hard-wire into
to multinational companies) agree to come their procurement processes. For this to work, HS2
together to share ideas, drive innovation and Ltd will also have to be rigorous about maintaining
break down barriers. This requires the creation this approach through to completion of the project.
of an environment where companies can share Exploiting cutting edge techniques and working
ideas and innovative approaches openly with collaboratively can help to accelerate the delivery
confidence that they will get the appropriate of HS2. Sir David Higgins’s report looked at the
credit. An example of how a collaborative delivery schedule for constructing HS2 and the practical
structure could look is below: and technical considerations but from a growth
perspective, delivering the line more quickly has
huge benefit.

HS2 Project
(e.g. HS2 Ltd) (e.g. 5 companies)

Supply Supply
chain chain
partner partner
Delivery
(e.g. 3–4 main
companies)
Supply Supply
chain chain
partner partner

42
 Recommendation 19: HS2 Ltd must ensure strong working
relationships with its contractors and workforces to deliver
exceptional results. It should start discussions with employers and
trade unions by the end of 2014 to agree a framework to deliver
high standards in working practices and skills development.

Getting businesses working most effectively HS2 Ltd should start discussions with employers
together is only the first part of the answer. In and trade unions by the end of 2014 to agree
getting delivery right we can learn from past a framework covering how it will deliver high
successes on projects like the Olympics and standards in working practices and skills
Heathrow Terminal 5, where early agreements development.
between all partners were an important factor
in on time and on-budget completion.

HS2 Ltd should expect its contractors to offer their

workforces top quality working practices and skills
development. Whilst framework agreements have
been used before, HS2 is an opportunity to do this
on a much wider scale and act as an exemplar. This
approach can both improve overall efficiency in
the construction of the railway by minimising the
risk of delay or disputes and benefit the workforce
as a whole by facilitating opportunities for skills
development, such as entry onto apprenticeships.

Terminal 5: A framework agreement

For the construction of Heathrow Terminal 5, a framework agreement was
put in place at an early stage between the client (BAA), the main contractor,
other major employers and the unions. This agreement enabled all parties
to work together with a commonly agreed set of principles, to identify and
resolve issues early, minimising delays and disruption.
Common standards were set to enable a consistent approach to issues
such as training and development and to ensure a fair deal for workers. This
approach broke new ground and was recognised at the time as being an
important factor in the success of the Terminal 5 construction project.

43
Next steps
We have set out in this report our Should the Government wish us to, the Taskforce
recommendations to the Government, local members collectively offer to reconvene at some
authorities, HS2 Ltd and the UK businesses and appropriate time in the future to review progress
workers who stand to benefit from HS2. We against our recommendations.
have taken nine months to gather evidence and
marshal our thoughts. Our experience and what Finally, we would like to thank all of those who
we have heard tells us that the important thing hosted us, talked to us and sent us their thoughts.
now is to shift to a focus on delivery; on making There wasn’t always agreement on every point.
growth happen. But those differences of view, and the passion with
which they were conveyed, helped us arrive at our
Our final recommendation is that we would like to recommendations. They also confirmed that we
see the Government, local areas, businesses and are all in collective agreement that HS2 is a once in
workers respond by acting on the challenges set a generation opportunity to transform our major
out in this report; cities if we act now.

• We think the Government should set

out in detail what it will do, by when and
who will be charged with delivering and
overseeing our recommendations. Given
the scale of the challenge, leadership
and accountability at the highest level is
needed;

• We would like local leaders

to deliver a public and firm
commitment to creating their own
HS2 Growth Strategy, supporting
local businesses and workers, and
making sure their cities are HS2
ready.

44
 Lord Paul Deighton Sir Howard Bernstein
Chair and Commercial Deputy Chair and CEO, Ray O’Rourke
Secretary to HM Treasury Manchester City Council Chair of Laing O’Rourke Group

Alison Nimmo Cllr Matthew Colledge Frances O’Grady

CEO, Crown Estates Leader of Trafford Council General Secretary, TUC

Sir Albert Bore Roger Marsh Sir John Rose

Leader of Birmingham City Council Chair, Leeds City Region LEP Former CEO, Rolls Royce

Neale Coleman
Lorraine Baldry Pete Waterman Mayor of London’s Adviser on
Chair, London and Continental Railways Cheshire and Warrington LEP Olympic Legacy

Steve Norris
Cllr Julie Dore Businessman and former Professor Tony Venables
Leader of Sheffield City Council Minister for Transport University of Oxford
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