by business editor Trevor Sturgess

Forecasts for use of the Channel Tunnel Rail Link - dubbed High Speed 1 - through Kent were wildly optimistic, leaving taxpayers with a £4.8bn debt, according to MPs.

The Public Accounts Committee said costly mistakes had been made and lessons should be learned before pressing ahead with the proposed High Speed 2 between London, the Midlands and the North.

It said passenger demand for international services on the line had been far lower than expected, with numbers only a third of original 1995 estimates.

The Transport Department had failed to properly consider the likely response from low-cost airlines and ferries.

It was “nonsense” that it did not have a full understanding of the wider economic impact and regeneration benefits of HS1 or the location of stations.

Committee chairman Margaret Hodge said: “Whilst HS1 provides an efficient service, contributing in an important way to British transport infrastructure, there were costly mistakes in the history of the project.

"These must not be repeated with HS2. HS1 was supposed to pay for itself but instead the taxpayer has had to pay out £4.8 billion so far to cover the debt on the project.

“The root of the problem is the inaccurate and wildly optimistic forecasts for passenger numbers both when the line was being planned and when the Department restructured its deal with the contractor London & Continental Railways.”

HS1 would continue to cost the taxpayer £10.2bn over the next 60 years.

Transport Department assumptions about the benefits of faster travel were “simply untenable.”

For example, the time business travellers save by using high speed rail is valued at £54 per hour yet the time commuters save getting to and from work is only valued at £7 per hour. It was difficult to see how this could be justified.

A Department for Transport spokesman said HS1 was a successful and central part of the UK’s transport infrastructure, carrying millions of passengers a year.

“It was delivered on time and on budget and this report commends the 'exemplary' way the sale of the line was handled – generating more than £2bn for the taxpayer, far exceeding market expectations.

“Our passenger forecast modelling has improved significantly since the original work for HS1 over 20 years ago, with better understanding of what drives passenger demand, better computer modelling and more computer power to do it.”