The definition of a builder’s estimate is a sum approximately half the final cost. Perhaps the Public Accounts Committee had this old truth in mind as they lightly grilled the executives who must convince us that HS2, Britain’s proposed new railway, is worth £50 billion to get us to Birmingham half an hour quicker.

The puzzle about this project is why the Tories are so keen on it in the first place, since it tramples through so many Conservative constituences (without stopping) and whose returns, even before the latest revisions, were marginal at best. Since then, mobile internet and tablets have made the time fly, and even the former CEO of what is now HS1 thinks HS2 is “away with the fairies”. The proponents are forced to argue that the new rails will be needed as the existing track reaches capacity. This sounds uncomfortably like the “predict and provide” policy that used to govern the roadbuilding programme, and is about as convincing. Perhaps we should look at double-decker trains instead.

For all the talk of the need for new infrastructure across the nation, it’s actually quite hard to find big projects that are worth doing. The transformation of London transport wrought by better signalling and more reliable trains underground, with sensibly-spaced buses above it, far exceeds any gain from the billions poured into Crossrail, a device to whisk plump bankers between Heathrow and the City.

Unfortunately, the political class will always prefer the grand projet to the intelligent upgrade. And once the project is under way, the red ink is “stepped in so far that, should I wade no more, returning were as tedious as go o’er.” It took real political courage (and a traditional British financial crisis) to scrap the TSR2 jet fighter. HS2 not only sounds uncomfortably similar, it’s almost as fast, without the wings. If we really must have this flying white elephant, let’s build it from the northern end. At least then there would be a temporary boost to Manchester and Birmingham.

The price of a vote

The Rothermeres did a little housekeeping last week. The owners of the Daily Mail offered to mop up a pool of voting shares in DMGT held by an outside branch of the family in exchange for more of the widely-held non-voters. The terms, 1.125 A for every ord., are being extended to the small band of non-family shareholders. Despite the derisory value this puts on the right to vote, it may not be all bad.

The dynasty already controls DMGT, and this deal would take the ownership from 60 per cent to nearly 90 per cent. Essentially, the outside shareholders are (even more) disenfranchised, a politically-incorrect position which has already been enough to see the stock ejected from the FTSE indices. Yet Jonathan Rothermere, fourth Viscount, like his father Vere before him (nick-name: “Mere”), has been widely under-estimated. On the declining business of newspapers he has built one of the world’s most-visited websites, offering a mixture of news, entertainment and wardrobe malfunctions.

Now the rump shareholders must choose between a highly liquid voteless stock, or one with full rights and zero liquidity (you might find 50, on a 12 per cent spread). The more that accept, the less liquidity will remain, but those accepting could console themselves with the thought that family-controlled companies, like Associated British Foods, N Brown or AG Barr, have been fine long-term investments, provided the family is still paying attention. This one certainly is.

Get a life

A missive arrives from the Equitable Life Payment Scheme, with news of the “fair and transparent” payments to policyholders “for relative financial loss suffered as a result of Government maladminstration in the regulation of Equitable Life.” I’m invited to brace myself for a cheque for 22.4 per cent of my “relative loss”. It’s not a life-changing sum, but at least I’m alive to see the (almost) final chapter in this saga. It’s been picked over so often that we must accept the strange idea that this was a failure of regulation, rather than being the fault of the life office itself, set up and run entirely for the benefit of policyholders in 1762, and brought down by a House of Lords ruling 238 years later. Still, as a taxpayer, it’s agreeable to get something back, however improbable its justification.

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