High Speed 2 – a proposed high-speed rail link between the north and south of England – is “economically flawed”, according to research from the Institute of Economic Affairs.

As such it is not “commercially viable” with taxpayers likely to face a “high proportion of the financial risks”, argues the free-market think tank.

The projected has been trumpeted by the coalition government as a potential replacement for airport capacity in the south of England.

However, the economics of the project are based on a series of “bogus assumptions” it is argued, with the Institute arguing government passenger projections are “very optimistic”, while competition from other lines – including the West Coast Main Line or from the Chiltern Line – has been “ignored”.

The cost of HS2 will require a contribution of £1,000 per tax payer, argues the research.

Commenting on the report, Richard Wellings, deputy editorial director at the Institute of Economic Affairs and co-author of the report, said: “High Speed 2 is another political vanity project – like Concorde and the Millennium Dome – being ploughed ahead with complete disregard for properly thought-through commercial prospects or the mounting opposition to it.

“Its environmental credentials are questionable, its projected passenger figures suspect, and its proposed regenerative effects highly dubious.”

Of particular concern to researchers is the first five miles of the route, from Euston to Old Oak Common.

The stretch will add almost 25 per cent (c. £4 billion) to the cost of the first phase but deliver negligible time savings.

The government is consulting on the project for a further ten days. Head over the official website for more information.