Alexander Jan: The killing of Crossrail 2 doesn’t only bode ill for London

Back in the early months of 2016, when Boris Johnson was London Mayor, George Osborne was Chancellor and Britain was still part of the European Union, a newly formed National Infrastructure Commission (NIC) was asked by the Treasury to look at three specific infrastructure challenges: a plan to transform the connectivity of the Northern cities; national energy policy; and perhaps of most interest to On London readers, priorities for future large-scale investment in London’s public transport infrastructure.

Preparing this piece, I stumbled upon the Treasury’s 2016 response to that London-related question. The department agreed that Crossrail 2 should be taken forward as a priority, with the aim of opening in 2033. In fact, it went further, endorsing the NIC’s view that the project should “not prevent the development of other high value schemes” and that it “should be at the heart of the new London Plan alongside existing commitments to upgrades and other pieces of new infrastructure.”

Fast forward to November 2020. How times have changed. Boris Johnson is, of course, now Prime Minister, we have Covid-19, Rishi Sunak as Chancellor, a Labour London Mayor and, for completeness, the UK is in the EU departure lounge. Crossrail 2 featured in the government’s new National Infrastructure Strategy, published with the spending review last week. But this time the project was used as the sacrificial offering for that (as yet) impossible-to-define political obsession “levelling up”.

In no uncertain terms, the 2020 strategy, which is the government’s response to the NIC’s latest infrastructure assessment, announced the scheme was to be killed off, apart from so-called route-safeguarding work aimed at preventing people from building on bits of the alignment. Why? Killing Crossrail 2 is designed to help free up investment “to raise the performance of public transport networks in the regional cities towards “London’s gold standard.” But quite how this stacks up is quite hard to see.

In financial terms there is little evidence that the government’s contribution to Crossrail 2 – either for preparatory works or indeed its £20 billion share of the £40 billion plus project proper – is going to gush into cities elsewhere anytime soon. There are, for sure, some quite big numbers in the Department for Transport’s latest capital expenditure plans. But these are largely on major roads – a whopping 60% increase to £27.5 billion over the lifetime of this this parliament – and High Speed 2 which is now consuming the thick end of £6 billion – yes, £6 billion – per annum.

There is also some money for the Oxford-Cambridge “arc” (bringing together one of the most prosperous parts of England with…one of the most prosperous parts of England), and then some £4 billion over four years for widely trumpeted “levelling up” projects. These cover everything from town centre tidy-ups to bits of bypasses and spending on arts and culture. There is a ceiling of just £20 million per project. And as it all has to be spent over the next few years on “shovel ready” style projects, the chances of underspending must be high.

In fact, Crossrail 2 – half of which was going to be paid for by London directly – was an important scheme for towns and cities beyond the capital. Those in the know have long argued that without it passengers disgorging from HS2 who live in some of the regional cities the government is now so keen to help – including Manchester, Liverpool and Birmingham – risk being met with massive delays as they fight to get on to the Tube at Euston. Perhaps in a post-Covid world the government now thinks the demand is not going to materialise? That would in turn raise further questions about the business case for High Speed 2.

Then there are the other towns and cities that Crossrail 2 would have helped to connect to better paid jobs. Basingstoke, Salisbury, Exeter, Poole, Woking, Guilford, Brighton, Peterborough and York feature among them. Of course, Londoners and businesses in the capital would have been among the primary beneficiaries of the project. But then they are also the ones who were destined to put their hands in their pockets two or three times over to help pay for it, through general taxation, extra property charges and the TfL farebox.

The collateral damage ditching Crossrail 2 has for London’s long-term development is perhaps the most disheartening impact of the announcements. As per the Treasury’s request, the project was fully integrated into the revised (but yet to be signed off) new London Plan. There are, in fact, no fewer than 42 references to Crossrail 2 in there. Tens of thousands of new homes – that the government is so keen on London taking – depend on it, many of them in less well-off parts of London and indeed the wider South East. Crossrail 2 is also entwined with a number of strategic infrastructure priorities, such as Opportunity Area development and town centre regeneration.

In short, it is pretty integral to the spatial blueprint for London’s development. How the London Plan can now be published without substantial amendments to take into account the apparent demise of Crossrail 2 is hard to see. But unravelling a document that has already become a political football between City Hall and Westminster is in itself fraught with difficulty, and would stoke uncertainty just as boroughs and businesses will be trying to come to terms with recovery from the pandemic and the aftershock of Brexit.

Some might say that Crossrail 1’s difficulties plus Covid-19 means that its sister scheme should be scrapped or at the very least seriously reconsidered. Those may be fair questions to raise. But it is interesting that such arguments don’t seem to apply when it comes to HS2 or the other big rail schemes the government has in its sights.

It appears there’s been a cynical policy shift by the government to somehow enhance its street credentials in other parts of the country. And the willingness of this government (and indeed its predecessors) to duck and dive on its investment commitments to the regions can cut both ways. Already there is nervousness about just how long the grass is going to grow before Northern Powerhouse Rail and High Speed 2B get built.

The tragedy is that it didn’t have to be this way. If London, and indeed the other major regions of England, had greater control over their own financial destinies, many schemes would be more likely to be worked through and choices about them made on a more transparent and accountable basis.

The fact that Crossrail 2’s axing was not so much buried but blazoned in, of all things, the first National Infrastructure Strategy, tells us much about how seriously the government – led by a former Mayor of this city – is committed to long term investment and the devolution agenda. Leaders in red-wall constituencies should beware.

Alexander Jan is chair of the Midtown business improvement district and former chief economist at Arup. Follow Alex on Twitter.

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