Affordability should not be included in the scorecard that the government sets third runway developers, Heathrow’s operations chief has told MPs, rejecting industry concerns that costs could spiral after ministers rubber stamp a design.
Helen Elsby, the chief solutions officer at Heathrow Airport Limited, said the project’s frontrunner was “absolutely aligned with the criticality of affordability”, but that it should not form part of the current planning process.
“We must remember that this is a project that spans 20 years… and therefore we believe affordability should be checked at regular touch-points,” she said at a Transport Committee hearing, adding: “Therefore to look at an affordability test within a policy that drives a planning statement – we are concerned that would… compromise the role of the CAA [Civil Aviation Authority].”
The remarks are likely to rattle cost-sensitive airlines and freight companies, who have called for greater scrutiny of the privately financed project’s affordability before transport secretary Heidi Alexander selects a preferred proposal. Currently, the framework against which Alexander will make a decision includes criteria on climate, noise pollution, nature and economic benefit, but there is no major benchmark on cost.
Airlines have been lobbying the Transport department to weigh up costs as part of its decision-making over Heathrow, to prevent any risk of a design that is unnecessarily expensive being approved. The hub’s customers – including the airlines and passengers – will have to foot the bill for the development process via charges that are added on to travellers’ fares.
Heathrow expansion to bring ‘enormous investment’ to UK
Heathrow’s scheme is seen as more expensive and more complicated than the rival plans proposed by hotel tycoon Surinder Arora. Its vision involves a longer runway, rerouting the M25 and relocating several lakes that surround the site. It is expected to cost roughly £10bn more than Arora’s competing Heathrow West plan, which has the support of most major airlines.
Speaking at the same evidence session, Arora told MPs his firm worked closely with carriers on his plan, which proposes a delivering a shorter runway initially, before then expanding to a full 3,500m strip should ministers wish.
“We didn’t go out there and dictate and say, ‘Well this is the length of the runway we’re going to do [and] we’re going to go over the M25,” he said. “We’ve always sat down with the customer and said, ‘What works for you? What do you want.'”
He added: “Hence we came up with our proposal of doing the runway in two stages. And plus we can do a lot quicker – five years quicker – than the [Heathrow Airport Limited] scheme.”
Separately, Heathrow boss Thomas Woldbye launched a robust defence of the merits of expansion, which has been thrown into disarray by a string of remarks by Andy Burnham. The Prime Minister has so far refused to endorse the megaproject, instead saying it is a matter for “London and Londoners”. But Woldbye said the no other aviation development could provide the same “huge investment” into the UK given Heathrow’s unique hub status.
“It provides strong economic growth for society right across the country,” he added. “It will drive jobs. It will drive education, apprenticeships, innovation and trade way beyond what is possible today.”