Politicians keen to make a mark or leave a legacy are enthusiastic about the HS2 high-speed rail northern extension. But it is easy to see why homeowners and businesses based anywhere near the proposed railway are less keen.
While our leaders are playing with other people’s money and tend to think the dear old taxpayer won’t notice a few billion pounds here or there, householders and businesses along the route understandably resent their most valuable assets being put at risk. Not to mention the added worry of having to wait perhaps five years to find out if they are entitled to any compensation.
Laws governing payments to those affected by grand projects such as HS2 are complex and often apparently arbitrary. For example, people living within the M25 motorway or in Birmingham near the proposed railway route will have fewer grounds for compensation than property owners in the countryside. Similarly, businesses with a rateable value of more than £34,800 a year will find it harder to claim than those below that cut-off.
Enthusiasts keen to see nothing stand in the path of progress have made much of the Exceptional Hardship Scheme (EHS). This is intended to help people who have an urgent need to sell their property but cannot do so, except at a substantially reduced price.
Unfortunately, official guidance does not include a definitive list of who is entitled to claim. Examples might include, though, couples selling up because of divorce, people relocating for work reasons or those affected by serious illness. It is understood, however, that more than half the applications made to the EHS for the London to Birmingham part of HS2, announced last year, have already been rejected.
For those affected, a few key dates might be worth bearing in mind. The route is due to be finalised some time this spring, with a Bill going before Parliament in the autumn. It is hoped that the project will receive Royal Assent in March 2015, and that work will begin in 2018. Finally, the first trains are scheduled to run in 2026.
Richard Asher, a director specialising in compulsory purchase issues at Savills, told me: "Once the route has been safeguarded, three things can happen. All residential occupiers within the safeguarded zone and business premises with a rateable value of less than £34,800 can serve a blight notice, asking HS2 to buy their property. All planning applications within the safeguarded zone will have to be referred to HS2, who will have the power to refuse such application.
"Residential owners who live outside the safeguarding limit but within a corridor of 60 metres either side of the safeguarding zone may also be able to require HS2 to buy their home, but only if they live in the country. This option is not available within the M25 or the conurbation of Birmingham.”
Quite why people in these areas should be treated differently remains unclear. Similarly, it is hard lines on businesses with a rateable value more than £34,800, which will have to wait until HS2 has compulsory purchase powers. That will happen only when the parliamentary Bill has received Royal Assent, which will not be before 2018. This means a minimum of five years’ uncertainty – possibly more if, as has been known to occur, the railway fails to run on time.
The Government is not, however, in the business of upsetting voters and it would be wrong to exaggerate the problems. Nick Barnes of Chesterton Humberts said: "On the face of it, the proposed compensation arrangements appear to be fair and reasonable. Claims for residential dwellings should be relatively simple, although those for commercial premises and farms will be more complex. They will need to consider business losses and disruption.”
Dealing with officialdom is seldom without complications and stress, he warned. "Property valuations may become contentious. Where owners dispute the amount of compensation, the burden of proof will be on the owner, not the Government.
"There may also be reluctant movers who will not be able to afford to move to a comparable property in a comparable location.”
Litigation already under way along the original HS2 proposed route reveals that people with property directly in its path may turn out to be luckier than those who live just a few hundred yards either side.
The owners of homes and businesses which have to be demolished to make way for the Government’s idea of progress are protected by statutory entitlement to compulsory purchase payments. But those well within sight and earshot of the new 250mph trains are left in limbo, awaiting further developments. For them, the sleepless nights may have only just begun.
James del Mar, head of the HS2 team at the international estate agents Knight Frank, explained: "Once the route is safeguarded, the provisions of statutory blight apply.
"It is important to note that statutory blight is only relevant where land is required for the construction or use of the railway. Should that be so, then a case can be brought for the property to be compulsorily acquired in its entirety. Any land or property owners who think they may be affected by the second phase of HS2 linking Birmingham to Leeds and Manchester should take action now to find out the extent to which the proposed route will affect them.”
Looking ahead over the very long term, people whose property is affected, but not required for either the construction or use of HS2, may eventually be able to claim financial recompense through the Land Compensation Act 1973. This allows claims to be made one year after the railway has been first used. But, as mentioned earlier, that is not expected to happen until 2026.
No wonder politicians from both the major parties who spoke in favour of HS2 on the BBC One programme Question Time in Lancaster recently were surprised at the hostile reaction of the public.
While the gains from these trains remain a far distant prospect, the pain for many property owners is here and now.