Comment: PM still to unite business on case for HS2

Martin Flanagan. Picture: Adrian Lourie
Martin Flanagan. Picture: Adrian Lourie
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THE duelling ground on the controversial HS2 rail project has definitely shifted, it became clear at yesterday’s annual CBI bunfest.

The debate has morphed into a straight cost versus passenger capacity issue, the government from David Cameron downwards having clearly decided that solving an overcrowding problem has a better a chance of convincing the public of the merits of the scheme than the simple prospect of reducing journey times.

It doesn’t change the stratospheric numbers (£50 billion and counting) associated with building HS2. Or the legitimacy or the arguments of those who claim the nation would be better off making numerous smaller improvements to the existing network, at much less cost.

But it is adroit politics because, in these days of mobile phones, ubiquitous corporate laptop usage and video-conferencing, shaving 30 or 40 minutes off journey times never looked a credible reason for the extra cost and environmental impact associated with HS2,

The CBI employers’ body is clearly signed up to the project as long as costs do not spiral out of control. This was also the position of shadow chancellor Ed Balls in his address to the conference.

One problem, however, is that those holding the purse-strings cannot anticipate cost overruns until they happen.

Think of the escalating bill for the Scottish parliament building, the Channel tunnel, or building the latest two aircraft carriers. Even with the shifting of the ideological ground for HS2, the portents are not particularly good that the project will be kept to within budget.

Business opinion, like public opinion, looks divided. The Institute of Directors has come out against the project, the British Chambers of Commerce is in favour.

The Prime Minister’s speech to the CBI fall short of definitive. But expect little about reduced journey times in the future cut-and-thrust, and ever more about alleged groaning capacity on the west coast mainline.

Elsewhere, as usual, the CBI’s views on everything from continued membership of the European Union (yes) to business reputational damage (stop playing to the populist gallery) was so much flagged beforehand that a strong sense of Groundhog Day was inevitable.

Weak signal puts doubt on future of BlackBerry

Blackberry hasn’t got a signal. Some would say the listing smartphone maker hasn’t got a clue. After several weeks of planning it transpires the embattled group has called off its plan to sell itself to its biggest shareholder, Fairfax Financial Holdings. It will raise $1bn (£672 million) from fresh financing instead.

What is the company going to do with it, though? BlackBerry has been taken to the cleaners in recent years by the likes of Apple and Samsung, which have not only eaten its lunch but its pudding and coffee, too, and made off with the telecoms goody bag at the end.

It’s also musical chairs at the top of the company, with boss Thorsten Heins stepping down and former Sybase chief executive John Chen becoming executive chairman and serving as interim chief executive while the company looks for a new leader.

With BlackBerry looking analogue in a digital world, and having just recorded a Q2 loss of $965m it is not quite a case of “form an orderly queue”.