Czech Railway Authority (SŽ) seek professional help to tell the ‘truth’ to the public over the VRT project. https://zakazky.spravazeleznic.cz/contract_display_10321.html
Rather than make full and frank disclosure of the numerical analysis that ‘supports’ their business case, SŽ decided to use 27m kc of our money to engage a PR company to sell us the unsellable. That is on top of their existing PR department and budget for the Czech HSR (VRT).
Where are all the passengers coming from?
SŹ have published ‘feasibility studies’ on their website. https://www.spravazeleznic.cz/vrt/studie-proveditelnosti
- What is missing, however, is the precise methodology by which those studies were produced. We require this and the data, with all sources, and all surveys from which the data were deduced. That must include the terms of reference of each. For example, we want to know precisely how the anticipated passenger numbers were arrived at, how the passenger ‘conversion’ figures were arrived at and the same for the ‘induced’ passenger numbers – that is those who would not ordinarily travel were it not for the VRT. We want to know what surveys were carried out, how the samples were selected and how the resultant data were interpreted.
- The VRT project is one of the largest and most expensive in Czech history. It is estimated that nine out of every ten such projects worldwide go over budget. They use an unhealthy formula for approval of underestimated costs, overestimated revenues, undervalued environmental impacts and overvalued economic development. This results in projects that are extremely risky, but where the risk is concealed from MPs, taxpayers and investors https://www.researchgate.net/publication/301852773_Megaprojects_and_Risk_An_Anatomy_of_Ambition
- ‘Outside in’ forecasting using a reference case is obligatory in a project of this scale. SŽ must tell the public how they performed this, giving all details. The ‘gold standard’ tool to avoid the optimism bias to which most promoters of such projects succumb is the ‘Reference Case Forecast’, developed by Kahneman, Tversky and furthered by Flyvbjerg et al..https://www.tii.ie/tii-library/policies/TII%20General%20Publications/RCF-Guidelines-for-National-Road-Projects.pdf
“the state has no source of money other than money which people earn themselves … There is no such thing as public money; there is only taxpayers’ money.”Margaret Thatcher
From a practical point of view, it does not matter whether SŽ has ‘officially signed off’ on this information or not. As soon as this information reaches the public space, it seems 100% true to the reader.
The taxpayer has a right to see this material, and SŹ has an obligation to produce it. The public must be given the opportunity to scrutinize the viability of a project that they will be obliged by law to both pay for and to become stakeholders in. In the private sphere, knowingly mis-selling an investment product, or knowingly misleading the investor of the risk profile is a criminal offence.
The headline figures that have been published by SŽ are in excess of any achieved by any other HSR in the world when you take population and geography into accounthttps://www.vrtaci.cz/2021/04/12/vice-nez-130-tis-cestujicich-za-den-sprava-zeleznic/.
“A high-speed railway line can have the same transport capacity as two new motorways.”
These figures create the illusion of a positive business case to sell the VRT project; but the figures are implausible.
In the UK, the business case for HS2 (VRT) is already considered low by the UK National Audit Office and this is with significant populations at the key stations served with high likelihood of a demand being created. The UK population is 6 times that of the Czech Republic and is growing fast; a 10% increase in the last 20 years. The Czech population has remained largely static for the last 100 years and it is not projected to change much.
If the advisors to Asociace pro Rozvoj Infrastruktury (ARI) https://www.ceskainfrastruktura.cz (a Czech transport lobby group – ‘think tank’) are to be believed, HSR is comparable to connecting cities with an additional two motorways of passenger carrying capacity. Think about it. Two additional 3 lane motorways between Brno and Prague. 12 additional lanes of traffic. Prof. McNaughton: “A high-speed railway line can have the same transport capacity as two new motorways.” … Continue reading
Where are all the passengers coming from?
It is said that a picture speaks 1,000 words:
The UK’s HS2 is designed to put the major towns it reaches within 1 hour of each other, effectively joining them up. You can see the route in the city lights. You can barely discern the Czech Republic in the images, just as it is all but impossible to see SŽ’s business case in the light of day.
The above table suggests that the original construction costs and the originally planned completion date of HS2 will be exceeded by 19% to 60% and the expected benefits (number of passengers) will be lower than expected by 30% to 64%. The current performance of the British HS2 construction program is already in line with this forecast. (Benefits are measured by the number of rail passengers (p. 13)).
Summary. Rather than engage a PR consultant, we believe that SŽ should publish all their numerical analyses with sources and terms of reference for public scrutiny.
The only reason SŽ would not publish this data is if there was something wrong with it, or it did not exist. If this is the case, the project is a charade, an exercise in consultants and developers fleecing the taxpayer.
Without a valid business case the project must stop.
This article was originally published by Vrtaci on 2021-08-02.