New HS2 compensation scheme does little to help people facing losses on homes

16th January 2015 – HS2AA is deeply disappointed that the Government has broken its promises to help those unable to sell their properties due to HS2.

172,000 households are within 1km of Phase 1 of the HS2 line from London to Birmingham (with 43,000 within 500m) and yet the schemes put forward by the Department for Transport today will be likely to compensate barely 3000 homeowners.

Ignoring evidence from Government advisers (PwC) on the extent of losses caused by HS2 – reports made available through FOI show that those living up to 500m from the line suffer average losses of 20% – the compensation package launched today continues to restrict applicants by distance and by circumstance, meaning it is eligible to only a few.  

The Voluntary Purchase and Cash Offer Scheme is only available to those living within 120m of the line in rural areas, excluding many thousands in urban areas and thousands more living over 120m away.  The derisory payments offered under the homeowner payment scheme do little to solve the actual problem – which is that people either can’t sell their houses or can only sell at a big loss.  The Need to Sell scheme appears little more than a rebranding of the previous deeply unpopular hardship based scheme and limits compensation only to those who can show that they comply with certain specific criteria – such as illness, job relocation or divorce.

For those who don’t fall within these rules, live outside the 120m rural cut off and simply want to sell their house at its fair market value before HS2 is completed in more than a decade, they don’t get anything and have no option but to suffer the losses, if they can find a buyer. 

Hilary Wharf, a director of HS2 Action Alliance (HS2AA) said:

It is deeply unfair that so many ordinary people, who through no fault of their own happen to live near to the planned HS2 line, continue to be left to bear these losses with no help from the Government.  People were promised “full and fair” compensation and this promise has been broken time and time again.

If HS2 is truly in the national interest then fair compensation should be paid to all those affected.  Instead people have had to endure 6 public consultations, financial losses, worry and stress and the dire administration from HS2 Ltd for nearly 5 years.

HS2AA has campaigned long and hard for fairer compensation and it is a worrying precedent for future infrastructure projects that the Government has not modernised compensation arrangements and has instead adopted a “do minimum” compensation policy.

The innovative property bond solution championed by HS2AA was estimated in a report by PwC to cost between £30m and £158m (depending on levels of effectiveness) and would have allowed the property market to continue to function without the Government needing to acquire large numbers of properties.  Yet this has been rejected in favour of schemes which will compensate very few people and leave many thousands more trapped in their homes”. 

Ends

Notes to editors:

HS2AA is a national organisation making the powerful case against HS2. It is a not for profit organisation working with over 100 local groups who believe HS2 does not represent an effective answer to the UK’s transport, economic or environmental needs. HS2AA have focused on an evidenced-based approach to challenging the business case, the environmental case and compensation arrangements.

In addition to detailed consultation responses, HS2AA petitioned the Select Committee on the compensation arrangements in November last year. A report on the key issues raised is here

The PWC report referred to above which was released by way of Freedom of Information Act request – HS2 Property Bond Cost Report, March 2014 can be found at:

https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/327755/hs2-property-bond-cost-report.pdf

55/hs2-property-bond-cost-report.pdf

 

For more information please contact:

Richard Houghton

Tel: 07803 178 037

Email: richardwhoughton@gmail.com

http://www.hs2actionalliance.org/