Transport Committee
Wednesday 21st October 2026
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09:16
Alex Mayer
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Alex Mayer
Order, order! Welcome to this morning's evidence session. This is the seventh and final oral session in our scrutiny of the government's draft Heathrow expansion. National Policy statement. I'd like to welcome Toby Perkins MP, who's joining us as a guest from the Environmental Audit Committee, which he chairs. Could I please ask our witnesses to introduce themselves? The Minister.
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Alex Mayer
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Alex Mayer
Very much welcome. So the draft Heathrow expansion, NPS opens with the statement that the government is committed to harnessing the opportunities Heathrow expansion creates, unquote. And the second chapter is devoted to demonstrating what is termed a clear need for this development. The Secretary of State, however, has reportedly said that the Prime Minister is open minded. So is the government committed to. Is the government is as committed to this policy as it was in June?
09:17
Steff Aquarone
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Steff Aquarone
Well, thank you very much, Sharon. May I extremely briefly say, and I remember your encouragement for me to focus on brevity today. Just very briefly, thank all the members of the Transport Select Committee for your continued scrutiny of the MPs. I look forward to considering the recommendations that you put forward, alongside the more than 27,000 responses that we've had through the consultation. And you're, of course, right to say, chair, that the Prime Minister has emphasised the importance of the consultation process and of considering the views of different voices. We've been clear throughout the National Policy Statement Review that we're going to carefully consider what the views are that we receive through the consultation alongside this committee's recommendations, before we set out what the next steps are in relation to the to the MPs, I of course, realize as aviation Minister, that any decision that relates to a third runway at Heathrow will be absolutely consequential, both for the UK economy more broadly.
But it's obviously normal for having a new Prime Minister for him to want to look at the detail of what is a very large, privately financed project and at the same time fundamentally recognise that air connectivity plays an incredibly important role. Heathrow Airport, as our international hub airport plays a critical role. Within that, the needs case of the MPs sets out the potential benefits of expanding Heathrow and that they are significant. But ultimately the government also has those four tests that would need to be to be met in order to facilitate expansion. So that is exactly where we are in the process.
But it's obviously normal for having a new Prime Minister for him to want to look at the detail of what is a very large, privately financed project and at the same time fundamentally recognise that air connectivity plays an incredibly important role. Heathrow Airport, as our international hub airport plays a critical role. Within that, the needs case of the MPs sets out the potential benefits of expanding Heathrow and that they are significant. But ultimately the government also has those four tests that would need to be to be met in order to facilitate expansion. So that is exactly where we are in the process.
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Steff Aquarone
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Steff Aquarone
Well, I think the Prime Minister was rightly reflecting on the fact that in terms of community impacts that might arise from any planning decision in relation to Heathrow expansion, those impacts would be especially felt for communities in London, and I would hazard to guess that a significant portion of the consultation responses themselves will be from affected parties in London, whether that be local residents, local businesses. It's why the MPs itself puts a very strong focus on mitigating community impacts about place making. The four tests have got a a special impact in a London context. It's also why we sought the views of affected communities throughout the process.
I went to Heathrow myself and met with the community groups most affected, and I think the Prime Minister was speaking to the fact that this is a decision of enormous consequence for London. At the same time, though, I think it's important to reflect on the fact that the Prime Minister also recognised the central importance of Heathrow to UK economic growth, to our resilience and also its status as an international hub airport in in contest with the likes of Charles de Gaulle, Schiphol or whatever else. So I think those two things can be true at the same time, that this is, of course, a matter for London, and it's of enormous consequence to London.
At the same time, this is a national question, and we've had a range of national answers to it through the consultation.
I went to Heathrow myself and met with the community groups most affected, and I think the Prime Minister was speaking to the fact that this is a decision of enormous consequence for London. At the same time, though, I think it's important to reflect on the fact that the Prime Minister also recognised the central importance of Heathrow to UK economic growth, to our resilience and also its status as an international hub airport in in contest with the likes of Charles de Gaulle, Schiphol or whatever else. So I think those two things can be true at the same time, that this is, of course, a matter for London, and it's of enormous consequence to London.
At the same time, this is a national question, and we've had a range of national answers to it through the consultation.
09:21
Alex Mayer
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Alex Mayer
Because I think your own department's figures say that 900,000 households or people will experience more noise with expansion than without. Obviously, some of those are outside London, particularly to the west. But if you if the if the decision is primarily going to be for Londoners, does this mean that the Mayor of London could have a veto?
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09:21
Steff Aquarone
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Steff Aquarone
It's not a case of it being primarily for London, especially relates to London because of those community impacts I spoke to, but also, as you say, compliance with the four tests and the ones that have specific local impacts around air pollution and noise, but also the economic benefits and the job creation benefits that could accrue from an expanded Heathrow airport. But in terms of the mayor's role, he has submitted a representation through the consultation. He can have involvement in the DCO process, particularly through the examination phase and in terms of what the mayor is responsible for, any potential promoter around Heathrow expansion would have to work extremely closely with TfL, which the Mayor of London chairs.
So there are there are many ways in which the views of the Mayor of London and of TfL especially, will be incredibly consequential to how any process around Heathrow expansion might unfold.
So there are there are many ways in which the views of the Mayor of London and of TfL especially, will be incredibly consequential to how any process around Heathrow expansion might unfold.
09:22
Speaker 4
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Speaker 4
Just on the London and for Londoners First care, how does that how is that going to manifest itself democratically? There is a vote plan, isn't there? Is it just going to be London MPs? Because surely MPs from Hull and Edinburgh we should. We should London colleagues make the decision if it is for London and London and for Londoners?
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Speaker 4
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Speaker 4
So I guess, I mean, in an ideal world, we'd be considering this proposal within the context of a, you know, an up to date aviation framework for the UK. You know, the current framework we have in the UK dates back to 2013, you know, pre Covid, you know, our understanding of the climate emergency was different back then as well. So really, should that not be the starting point? Updating the the policy framework for aviation in the UK before we then go on to look at Heathrow, because surely Heathrow has to fit in to an up to date policy framework.
09:23
Steff Aquarone
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Steff Aquarone
Well, so I think Hannah and Martin can speak to the a special reasons why Heathrow expansion needs a kind of designated process through its own policy statement. I sort of don't agree with the kind of broader thrust of the question about the fact that Heathrow expansion is being considered in a context where we don't have a general kind of strategy for how aviation policy in the country is conducted.
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09:24
Steff Aquarone
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Steff Aquarone
It's not in one document, but it is. It's in statute. For example, we've passed the SAF mandate and created the RCM, which is a world leading way in which to pursue sustainable aviation fuel. We've consented expansion at Luton and Gatwick. We are doing some of the everyday fixes that the Prime Minister talks about around aviation policy to make the travelling experience better for passengers. We're pursuing a lot of work through the Department on Aviation Decarbonisation and we're reviewing the jet zero strategy. So that principle of facilitating growth in our aviation sector, but doing it in a way that meets the UK's legally binding carbon commitments, making sure that all of the ancillary benefits of jobs growth reindustrialisation pushing more power out into local communities that the Prime Minister has talked about is facilitated through our aviation policy, does constitute an aviation strategy.
It's a fair challenge to say that it isn't contained in one document. And I recall that when the Secretary of State gave evidence, I think it was almost a year ago to this meeting. She said that if there is a call from the sector to produce a sort of consolidated strategy for aviation, that is certainly something that she'll consider. But in the meantime, we're advancing those priorities through a through a lot of different avenues. I don't know if anything else.
It's a fair challenge to say that it isn't contained in one document. And I recall that when the Secretary of State gave evidence, I think it was almost a year ago to this meeting. She said that if there is a call from the sector to produce a sort of consolidated strategy for aviation, that is certainly something that she'll consider. But in the meantime, we're advancing those priorities through a through a lot of different avenues. I don't know if anything else.
09:25
Speaker 2
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Speaker 2
Yeah. So the only thing that I would add to what the minister has said is that Heathrow is a nationally significant piece of infrastructure. So it is subject to the Planning Act 2008. That's why we need a national policy statement to to take forward any any expansion. The previous Airports National policy statement only applied to Heathrow. One of the reasons why we have renamed the NPS for this post review is to clarify that it only applies at Heathrow in terms of capacity elsewhere. That is subject to the making best use framework. That is a policy framework introduced in 2018.
Since that was put out, we have seen applications come forward some, some of which the minister has has mentioned. So that is kind of where that sits in the in the aviation strategy ecosystem that the minister explained.
Since that was put out, we have seen applications come forward some, some of which the minister has has mentioned. So that is kind of where that sits in the in the aviation strategy ecosystem that the minister explained.
09:26
Speaker 4
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Speaker 4
Yeah, some people are a bit kind of befuddled that we're people who live next to other airports where they feel the impact, you know, noise, air pollution and all these things. They're a bit befuddled that we're spending so much time on this airport where they're living next to one, which causes them just as much discomfort and inconvenience, etc.. And they do wonder why, as a committee, we're looking at Heathrow, but we don't look at their airport, whether it's Gatwick or whatever. So it does feel like we're missing something because this is a national policy statement.
It was a chance to look at all aviation as a system in the UK. I know it's bigger than just the UK, it is a system. But instead in a national policy statement we are just looking at one airport. Is it just it's not even just a London policy statement going back to this London for Londoners.
It was a chance to look at all aviation as a system in the UK. I know it's bigger than just the UK, it is a system. But instead in a national policy statement we are just looking at one airport. Is it just it's not even just a London policy statement going back to this London for Londoners.
09:27
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09:27
Steff Aquarone
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Steff Aquarone
I was just going to briefly add that it is a fair challenge to ask about how we are working across the piece. And you're right to say that there is all of this attention on Heathrow Airport, and if you live nearby to Edinburgh Airport, Glasgow, and you've got concerns about air pollution, noise pollution, what is the government doing in that space? I would say that a lot of the ancillary policy questions that affect Heathrow expansion are national, and we are advancing work on them. If you take airspace modernisation and the refresh of cap 1616, which is going to allow for quieter, more efficient journeys, which will hopefully reduce noise for local communities, that there is an impact of that.
The the fact of the matter is, though, at the same time, Heathrow Airport's been operating at almost 95% capacity for I think it's two decades now. And the rest of the London airport system, I believe, is is scheduled to be at full capacity by the mid 2040s. So this is a pressing question for us to consider on a national basis because of Heathrow's value, not only as our international hub airport and the resilience that gives, including to airports like Edinburgh, which facilitate connections in for longer haul connectivity. But also an enormous amount of air freight has moved through Heathrow.
And I think it's right to say I think it's 24% of the value of imported goods to the United Kingdom move through that single airport. So it's of national consequence. But you're right to say that our aviation policy needs to serve the whole United Kingdom.
The the fact of the matter is, though, at the same time, Heathrow Airport's been operating at almost 95% capacity for I think it's two decades now. And the rest of the London airport system, I believe, is is scheduled to be at full capacity by the mid 2040s. So this is a pressing question for us to consider on a national basis because of Heathrow's value, not only as our international hub airport and the resilience that gives, including to airports like Edinburgh, which facilitate connections in for longer haul connectivity. But also an enormous amount of air freight has moved through Heathrow.
And I think it's right to say I think it's 24% of the value of imported goods to the United Kingdom move through that single airport. So it's of national consequence. But you're right to say that our aviation policy needs to serve the whole United Kingdom.
09:28
Speaker 4
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Speaker 4
Yeah, but a lot of that value is gold that goes back and forth. It's a it's a really interesting area, actually, but not one I don't quite understand why you have to have to do that quite so much in terms of airspace modernisation. I don't speak for Edinburgh, but they would say the focus on Heathrow is delaying the modernisation of airspace right across the UK, because it's soaking up all that capacity. So you touched on modelling of air passenger numbers up to 2040, etc.. One of the challenges is that we don't have a long term predictor of what the demand is going to be for air travel, particularly beyond 2050.
Is that is that a concern in terms of when we look at the economic benefits of this?
Is that is that a concern in terms of when we look at the economic benefits of this?
09:29
09:29
Speaker 2
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Speaker 2
So I think in terms of the modelling, you're right that the model I think runs to about 2054 and and that that runs for one year of the airport being at full capacity. Once all the capacity is increased, what we have done in the economic appraisal is extrapolated those benefits out to a full 60 year appraisal period.
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09:29
Speaker 2
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Speaker 2
Yeah, we we have done it in line with standard transport appraisal guidance. We have used the peer reviewer that I know the committee has seen previously to look at the work that we have done and the work that frontier have done, and I think it is . It is as it needs to be for the for the purposes of the hemp. Yes,
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09:30
Steff Aquarone
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Steff Aquarone
Well, it's worth saying that the the research that's already been conducted shows that if expansion does proceed, it can create economic growth right across the country. It's obviously right to acknowledge that the economic case is less when compared to the 2018AMPS, we can talk about the kind of range of factors as to why, as to why that's the case, and that's due to like planning increases at other UK airports, reduction in the number of business passengers. But separate analysis carried out by the Department for transport shows that the cumulative benefit to the scheme could create between 39 to £52 billion worth of benefits for UK passengers and the wider economy, and a lot of that growth can be centred on areas outside of London and the south east of England.
And I think it was Doctor Laird, in his evidence that he provided to you, said that that's still high for a mature economy in terms of the rate of return for an economy that is already very well connected. So in terms of meeting the expectation that Heathrow is critical to economic growth, but also that that the benefits of that growth are accrued across the United Kingdom. The case for it is there. But I also won't say to the committee that it compares in the same way as it did to 2018, because it doesn't. But I would also.
And I think it was Doctor Laird, in his evidence that he provided to you, said that that's still high for a mature economy in terms of the rate of return for an economy that is already very well connected. So in terms of meeting the expectation that Heathrow is critical to economic growth, but also that that the benefits of that growth are accrued across the United Kingdom. The case for it is there. But I also won't say to the committee that it compares in the same way as it did to 2018, because it doesn't. But I would also.
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Steff Aquarone
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Steff Aquarone
But I would also reflect on the fact that it's about economic growth, but it's also about economic resilience, and it's about the comparative disadvantage of having having not expanded the airport compared to where we are now, with the capacity constraints that we might see, and through that air freight piece, but also through the the question of international connectivity through a hub airport. I do think it's critically important that we reflect on what the resilience impacts may or may not be of not expanding Heathrow Airport in that context, because whereas other countries have kind of moved far ahead to kind of cement their status with with their international hub airports, whether that be in France or Germany or Turkey, we are at a position where Heathrow is at 95% capacity, and we need to kind of think about those broader questions in that context.
So it's a resilience question as much as it's a growth question.
So it's a resilience question as much as it's a growth question.
09:32
Speaker 4
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Speaker 4
But Heathrow choose to operate in 95. They could operate 80 if they wanted to. That's just that's just where they are. And this comes back to a point we've talked about previously, is how much capacity do you think we should reserve for resilience? I mean, I'm going to stop the chair from quoting. She often quotes that we just need an extra runway with no extra flights, and to give us the resilience we need at the airport. So how much capacity should we reserve at the airport just for resilience, or should we use 95% of capacity?
Again.
Again.
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Steff Aquarone
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Steff Aquarone
That would be the argument. Yeah. I think resilience is critically important. And the argument that you would make in the context of expansion is that by facilitating growth in a sustainable way, through a phased approach, could be the way in which that expansion happens. There is also a broad piece around making the existing footprint of the airport work better, whether that be through terminal modernisation. But I think the MPs reflects the fact that if expansion goes ahead, it would need to be facilitated in a phased way through an increase in those things that facilitate resilience, whether that be surface access schemes or terminal expansion or how you get passengers through the airport.
So I'm not sure if I'm landing exactly on what your question is, but that resilience has to.
So I'm not sure if I'm landing exactly on what your question is, but that resilience has to.
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Alex Mayer
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Alex Mayer
Yeah. Can I just pick up a couple of points, one on the aviation strategy or lack of and I mean, you talked about environment groups and communities in near other airports, but actually the concern about a lack of aviation strategy that we heard from was principally from people in the aviation sector themselves. And, you know, for instance, where where is the strategy for the place of aviation in facilitating freight or domestic connectivity? We on domestic connectivity, we found a lot of support for the idea of getting more flights in the regions to Heathrow, but nothing on the mechanism of how that would happen.
Sorry, apologies. This may be coming up later in questions, I think, but and also the economic growth around the country, your own figures, your own department's figures showed that a lot of the growth around Heathrow and west London would be at the cost of some of our UK regions and the airports themselves. Many of the regional airports are not in great financial shape and are actually worried about losing business. They're being very reticent about going on the record, but they're not coming full square behind Heathrow Airport's expansion this time round that they were eight years ago.
Sorry, apologies. This may be coming up later in questions, I think, but and also the economic growth around the country, your own figures, your own department's figures showed that a lot of the growth around Heathrow and west London would be at the cost of some of our UK regions and the airports themselves. Many of the regional airports are not in great financial shape and are actually worried about losing business. They're being very reticent about going on the record, but they're not coming full square behind Heathrow Airport's expansion this time round that they were eight years ago.
09:35
Steff Aquarone
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Steff Aquarone
Well, those are all fair challenges. And I think from the perspective of regional aviation, I would say there are a number of regional airports who are behind Heathrow expansion because of the greater benefit that it could accrue to them by facilitating connectivity to that hub airport. Hannah may want to speak in a moment about what the MPs specifically includes to facilitate growth in regional aviation. You're right to say that in some of the modelling forecasted, long haul connectivity does decrease at certain airports, and I think in a lot of the Prime Minister's comments, he reflected on the fact that regional aviation is central to the success of our aviation sector in the UK, and that we need to reflect on that as we go through this process.
I recently met with the trade organisation representing small airports, and they set out some of those same concerns, both about connectivity to airports, about the fact that the cost stack is increasing due to kind of international factors, as well as domestic ones, which make the cost of doing business challenging for them. They raised air freight in that context, and we know the impact that East Midlands Airport has and a number of other airports in terms of our freight resilience and connectivity. If there is a consistent call for a either an air freight strategy or a way in which we look in one consolidated way at aviation strategy across the United Kingdom, I would be very keen to to kind of hear those calls from the sector.
In the meantime, we'll carry on working through all of these policy questions that we deal with on a daily basis. But it's my responsibility to to serve the best interests of UK aviation. And also, if the committee wish to reflect on how we could go further through the M.P.s, whether that be in relation to making best use or those broader questions. We'd also be very glad to hear that feedback.
I recently met with the trade organisation representing small airports, and they set out some of those same concerns, both about connectivity to airports, about the fact that the cost stack is increasing due to kind of international factors, as well as domestic ones, which make the cost of doing business challenging for them. They raised air freight in that context, and we know the impact that East Midlands Airport has and a number of other airports in terms of our freight resilience and connectivity. If there is a consistent call for a either an air freight strategy or a way in which we look in one consolidated way at aviation strategy across the United Kingdom, I would be very keen to to kind of hear those calls from the sector.
In the meantime, we'll carry on working through all of these policy questions that we deal with on a daily basis. But it's my responsibility to to serve the best interests of UK aviation. And also, if the committee wish to reflect on how we could go further through the M.P.s, whether that be in relation to making best use or those broader questions. We'd also be very glad to hear that feedback.
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Steff Aquarone
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Steff Aquarone
No, that's not quite what I'm suggesting. I think whether it's kind of in aviation decarbonisation, through the creation of a framework to facilitate SAF production in the UK or consenting airport expansion at Gatwick, Luton, London City, the government is getting on with the job of supporting UK aviation. The question remains, however, if there is a call for a strategy which addresses all of these questions in the round, that's a that's an appeal that I'd be. I'd be very keen to hear because we want to be as responsive as possible in meeting the needs of the sector.
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Steff Aquarone
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Steff Aquarone
And it's a very fair challenge. And I think I set out in my previous answer to Scott, how some of those economic benefits accrue in ways that perhaps haven't been reflected in some of the analysis that we've seen in terms of Heathrow expansion, potentially generating tens of billions of pounds of economic value, and that value being accrued at areas outside of London and the south east of England. But you're also right to challenge me on the net present value. What I would say is it doesn't account for all of the anticipated impacts and the benefits of what Heathrow expansion could bring.
That's why the department commissioned that extra analysis from Frontier Economics, which looked at key impacts that kind of sit outside of the NPV calculation. It found positive GDP benefits in all scenarios modelled and indicated that those benefits could support growth across the country. It's also worth saying that freight benefits that could result from an expanded Heathrow aren't fully included in any of the appraisal or modelling undertaken, and in 2024 that represented £216 billion worth of imports and exports to the United Kingdom. So there are ways in which the NPV doesn't account for the entire potential benefit of an expanded Heathrow, but it's.
But it is a fair challenge to raise. I don't know if there's anything else you'd want to add on that front.
That's why the department commissioned that extra analysis from Frontier Economics, which looked at key impacts that kind of sit outside of the NPV calculation. It found positive GDP benefits in all scenarios modelled and indicated that those benefits could support growth across the country. It's also worth saying that freight benefits that could result from an expanded Heathrow aren't fully included in any of the appraisal or modelling undertaken, and in 2024 that represented £216 billion worth of imports and exports to the United Kingdom. So there are ways in which the NPV doesn't account for the entire potential benefit of an expanded Heathrow, but it's.
But it is a fair challenge to raise. I don't know if there's anything else you'd want to add on that front.
09:39
Speaker 2
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Speaker 2
The only thing that further that I would would add to to what the minister has said is, is that in in providing an application for development consent, any promoter would have to demonstrate that their application met the economic growth test, which would also seek to address that. So, so what the work that we have done at this stage in terms of the economic appraisal and that spatial computable general equilibrium modelling by frontier, looks at the kind of scheme level looks at the case for the application stage. They would also have to demonstrate that what they were doing met all of those requirements.
09:39
Daniel Francis
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Daniel Francis
I think the difficulty for us as a committee is we started this process six weeks ago with one set of figures. We've now had a supplementary piece of information given to us with a different set of figures. Even in that supplementary piece of written evidence, it accepts that the revision that there are further results presented in chapters nine and ten on technical technology development and scenarios and sensitivities analysis, which isn't yet available, which the government will produce in due course. And then combined to that, we've got the issues around the welfare analysis in the here and the GDP outcomes from the frontier model.
So why did we not try and look at those in a combined way and combine some of those aspects? Because the the difficulty we currently have is the level of information we have and that not being combined. So so what's the rationale behind that and how you're proposing to bring that forward?
So why did we not try and look at those in a combined way and combine some of those aspects? Because the the difficulty we currently have is the level of information we have and that not being combined. So so what's the rationale behind that and how you're proposing to bring that forward?
09:40
Speaker 2
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Speaker 2
I will take that. So in terms of the technical issue, I know that you've had a letter from my colleague at the department that that was about the modelling at Gatwick and the scenario that the modelling produced in terms of the constraint on runway and terminal capacity that had not previously been seen. Because of that, it didn't capture all of the the kind of ensuing expected passenger benefits. We have now corrected that. We've written to the committee with the with the update on that, the kind of punchline on that is it will increase the benefits from expansion, but not our overall conclusions in terms of.
Can we combine the work of the modelling and the work of the of the economic case? As I've said, they look at slightly different things. So the modelling looks at the impact of an intervention, like expansion on the wider economy, on what business investment trade kind of opportunities arise. The economic case does the kind of pure benefits versus costs, how do how do you stack them up? So what we are doing, what we are doing is looking at, can we bring those two together? Can we combine them in, in the way that you've suggested? That is a complicated process because it involves the risk of double counting.
So we want to do that in the most analytically robust way. We are working on that, and we hope to provide an update on that alongside the final MPs.
Can we combine the work of the modelling and the work of the of the economic case? As I've said, they look at slightly different things. So the modelling looks at the impact of an intervention, like expansion on the wider economy, on what business investment trade kind of opportunities arise. The economic case does the kind of pure benefits versus costs, how do how do you stack them up? So what we are doing, what we are doing is looking at, can we bring those two together? Can we combine them in, in the way that you've suggested? That is a complicated process because it involves the risk of double counting.
So we want to do that in the most analytically robust way. We are working on that, and we hope to provide an update on that alongside the final MPs.
09:41
Daniel Francis
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Daniel Francis
And I hear what you say on the written evidence, but on those two aspects I referred to, you know, it does say in that supplementary piece of written evidence in I think it's sorry, HEN0088. And the updated figures will be published alongside the government's consultation response. So you're accepting that, you know, this is a continuing to move. And and we'll receive those after we've made our comments on that. So we've heard in the inquiry about potential economic and business benefits, and particularly on losing that international competitiveness, really on on having a hub airport. And I think there's some compelling arguments on that.
But what we've struggled to find on that is figures. So. So do you have figures on that that you can try and produce to us on, on, on that aspect?
But what we've struggled to find on that is figures. So. So do you have figures on that that you can try and produce to us on, on, on that aspect?
09:42
09:42
Daniel Francis
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Daniel Francis
Are we ? What we've heard consistently is one of the other than growth. One of the issues here is the competitiveness with Schiphol and Charles de Gaulle, etc., but no one has really been able to produce us any figures to evidence that. So are you planning to produce that in due course in those figures as well, about the the rationale of why we would lose our competitiveness as a hub airport if we don't have a third runway.
09:43
Speaker 2
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Speaker 2
I think I would say that I think I think the way that that manifests itself in the work of the economic appraisal report in the in the here is in what we forecast to happen in terms of capacity and where we expect that capacity to go. So underpinning the work of the appraisal report is, is assumptions that are made about air traffic that either come routes through Heathrow that otherwise wouldn't have, or traffic that routes through other other airports. So I think that is how that is addressed through the economic appraisal report. But I don't know.
Martin, do you agree with me?
Martin, do you agree with me?
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09:44
Speaker 2
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Speaker 2
As in why why is the NPV not included in the. Yes, yes. So so I think the reason is because we see the MPs and the here as two two documents that sit alongside each other. There's lot there's lots of information in here . What, what we sought to do in the. It is the planning framework. So it summarises the the strategic case. It summarises the needs argument. The here should be seen alongside it. Also within the MPs we set out elements like the economic growth test, the other tests that we would accept expect any application to to meet.
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09:44
Speaker 3
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Speaker 3
I mean, I add to that what we try to do is the existing MPs and update it for ease of comparison. So the figures in the MPs use the same figures for comparison as the as the MPs, rather than introduce new ones. But as Hannah said, those figures are in supplementary documentation, setting out the whole case for for the MPV and what's included. And obviously those environmental disbenefits do form part of the of the MPV, and they're set out line by line in that supplementary documentation.
09:45
Alex Mayer
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Alex Mayer
Actually just one one question of clarification in the some of your detailed figures for your economic case, the appendix B of the letter of 24th of September. Table two, it talks about displaced passengers versus new passengers. Have I read this right that until up until 2050, the vast majority of new passengers at Heathrow have. Runway three goes ahead, are displaced, i.e. taking a journey to or from Heathrow as opposed to, to or from another airport.
Is that correct?
Is that correct?
09:45
Speaker 3
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Speaker 3
So it's right that we model the whole system. We don't look at airport. We look at the movement of passengers between those those things. I would have to look at the specific of what level of displacement versus new passengers is on that. But it's also modelling the cost as well. So some passengers just this is.
09:46
Alex Mayer
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Alex Mayer
Just the passengers. Additional Heathrow passengers with with expansion under the current trend scenario, no cost path through place compared with no expansion. So displaced business share, let's say take 2045 94% displaced 6%, new business, new passengers and leisure, which is the vast majority of Heathrow passengers , 2045 87% displaced and 13% new passengers. So that suggests an awful lot of passengers using runway three would have otherwise been going in and out of other UK airports.
09:46
Speaker 3
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Speaker 3
Well, I would say is the model. People want to fly from Heathrow and it places a big demand on that and people are willing to to do that. So it's people's preferences and choices of where where they fly is an important part of the model as well. And that's why we see a lot of demand at Heathrow. But on the specific displacement figures, I think we would have to come back on that.
09:47
Speaker 2
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Speaker 2
Yeah. And I think the I think the other element is that this this is about this is about as the system fills up over time. So by the by the point at which you get to the 2050s, the system is more full. But in the period where the system is less full, you do see more displacement. So it's about the kind of longer term case as well.
09:47
09:47
Speaker 4
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Speaker 4
Sorry, I know you just that that comment you made about people want to fly from Heathrow. I mean, surely people want to fly from their local airport. I mean, there's nothing special about the coffee you get Heathrow that makes me want to go via Heathrow. So? So what do you mean when you say people want to fly from Heathrow? If I live in Edinburgh, surely that fact does not hold true.
09:47
09:48
Alex Mayer
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Alex Mayer
09:48
Steff Aquarone
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Steff Aquarone
They're not in isolation. But this process is happening concurrently with that expansion in capacity at other London airports, which will facilitate greater connectivity from them. And we are operating in that context, whereby the mid 2040s London airport capacity will be more full and therefore Heathrow expansion could be one means of facilitating a greater ability to deal with that in a more resilient way. But that's not to say that that would disadvantage the ability to fly from Gatwick or Luton or wherever else. People also choose to fly from Heathrow because of their connectivity to routes that otherwise aren't served by London airports as well, which I guess is an important factor in the context of this conversation.
09:49
09:49
Speaker 5
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Speaker 5
Thank you. I mean, just to explore that a little more, I think maybe there's an interesting difference in terms of passenger choice between those who are using Heathrow to fly out of the UK and those who are attempting to get in. Certainly, as Scott says, for myself, as someone living in the North, I've lots of my journeys overseas have been from Heathrow or Gatwick, but that's because that was the only choice available to me. So I mean, is there a difference between the choices that UK passengers are forced to make when they're going on their holidays overseas, and the choices of passengers flying into the UK who might prefer to get to London as their holiday destination, has been any assessment about how much this is satisfying the demands of overseas passengers, and how much is satisfying the demands of UK based passengers.
09:49
09:50
Speaker 2
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Speaker 2
No, I think I think we may have to come back to you on that one. I mean, I think I think it goes back to sort of the point I was trying to make. Probably not very well, that this is about the system growth over over that period and the growth in demand that we expect to see over that appraisal period. So when we look at the kind of breakdown of the model, we do see long haul growing out of of other destinations than London over that period as well. So by the time you get to 2050s, you are seeing growth elsewhere.
Go back to the point there is there is a nearer term impact, which I think is what the letter is getting to. But but very happy to come back in more detail on those points.
Go back to the point there is there is a nearer term impact, which I think is what the letter is getting to. But but very happy to come back in more detail on those points.
09:50
Steff Aquarone
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Steff Aquarone
May I just briefly add that, you know, this is sort of a resounding theme coming from the committee, which I'll be certain to take away and reflect on about whether we do need one approach for looking at some of these questions in the round. I would just say quite jealously. As a northern MP, I share your sentiment that I would like to see better long haul connectivity from the likes of Manchester. They've got expansive plans to be able to facilitate that, and the Department of Transport also has a responsibility, alongside considering these questions, to think about how best we can facilitate that, it doesn't change the overall calculus in my view, however, though, that Heathrow is and will continue to serve as the UK's international hub airport with connectivity to certain parts of the globe that otherwise couldn't be efficiently or effectively served from other airports.
And therefore, we need to think about these specific questions in that context. But I would like to see long haul connectivity increasing at a broader range of airports across the United Kingdom, and I'll reflect on how we can do that in a more joined up way.
And therefore, we need to think about these specific questions in that context. But I would like to see long haul connectivity increasing at a broader range of airports across the United Kingdom, and I'll reflect on how we can do that in a more joined up way.
09:51
09:51
Steff Aquarone
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Steff Aquarone
Well, I would say that this consultation process is what allows us to better bottom out, where people feel that those concerns are, and we can develop analysis off the back of it. I guess the MPV and the original growth calculations did provide a picture, which is dissimilar to what was put forward in 2018. That spurred us to have a conversation within the department about how better we might capture some of those effects. That couldn't be. So we're able to be kind of reactive in that sense, and be able to account for challenges that we didn't necessarily anticipate.
If the committee believes that there are certain kind of negative externalities to potential expansion which aren't being fully captured through the MPs, that's certainly something that we can look at further and take away.
If the committee believes that there are certain kind of negative externalities to potential expansion which aren't being fully captured through the MPs, that's certainly something that we can look at further and take away.
09:52
Steff Aquarone
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Steff Aquarone
Thank you. This novel designation of critical national growth infrastructure. This has been made up to force this through hasn't it? No. We've drawn very much on an established precedent that exists in other planning frameworks through the Energy National Policy Statement. The wording of how it is designated has been changed to reflect the fact that both the needs case and the centrality of Heathrow for questions that pertain to economic growth and resilience is very acute, and that that should be weighed as part of a planning application. It doesn't change the fact that every aspect of the MPs goes through a planning process, which is which is legally judged.
We have the four tests to facilitate expansion, which, if they are not met, expansion could not be facilitated. So whilst the Ngai designation reflects the fact that whether it be through freight connectivity or airport connectivity, Heathrow is central to our growth and resilience as UK plc, it doesn't change the fact that expansion would only be able to happen through an established legal process, and with compliance with the four tests and parking, parking, some of what you've said if you're drawing on the designation of critical national infrastructure from elsewhere, might you be able to explain exactly how the four tests would sit in the hierarchy compared to the designation?
Because critical national infrastructure essentially says that those four tests are subservient to all but the most deleterious consequences. Well, I would say that the economic growth test itself. So where any potential scheme is expected to contribute to growth at national, regional and local level, and the plans maximise opportunities around accruing benefits, is pretty central to the principle of Ngai. The other three that relate to climate change, noise pollution, air quality are not optional. They have to be met in order to facilitate expansion. So I think you can see these things working concurrently together to provide a clear steer from government to a potential promoter, that you need to make sure that your scheme meets the UK's climate responsibilities does not worsen air quality impacts, does not worsen noise impacts compared to the baseline.
But at the same time, we recognise the fact that the questions surrounding expansion do fit into ones which are consequential to national growth. Okay, but some of our evidence is really challenged. The what you've just said about about those four tests still being material in the context of the designation like this, but just on the point of the economic case being so self-evident. If that is the case, why don't you rely upon the arguments of that test to make the case for the economic consequences? Why does it need a CNGI, as I say, never seen before in planning terms and not referenced in legal terms either.
We have the four tests to facilitate expansion, which, if they are not met, expansion could not be facilitated. So whilst the Ngai designation reflects the fact that whether it be through freight connectivity or airport connectivity, Heathrow is central to our growth and resilience as UK plc, it doesn't change the fact that expansion would only be able to happen through an established legal process, and with compliance with the four tests and parking, parking, some of what you've said if you're drawing on the designation of critical national infrastructure from elsewhere, might you be able to explain exactly how the four tests would sit in the hierarchy compared to the designation?
Because critical national infrastructure essentially says that those four tests are subservient to all but the most deleterious consequences. Well, I would say that the economic growth test itself. So where any potential scheme is expected to contribute to growth at national, regional and local level, and the plans maximise opportunities around accruing benefits, is pretty central to the principle of Ngai. The other three that relate to climate change, noise pollution, air quality are not optional. They have to be met in order to facilitate expansion. So I think you can see these things working concurrently together to provide a clear steer from government to a potential promoter, that you need to make sure that your scheme meets the UK's climate responsibilities does not worsen air quality impacts, does not worsen noise impacts compared to the baseline.
But at the same time, we recognise the fact that the questions surrounding expansion do fit into ones which are consequential to national growth. Okay, but some of our evidence is really challenged. The what you've just said about about those four tests still being material in the context of the designation like this, but just on the point of the economic case being so self-evident. If that is the case, why don't you rely upon the arguments of that test to make the case for the economic consequences? Why does it need a CNGI, as I say, never seen before in planning terms and not referenced in legal terms either.
09:55
Speaker 3
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Speaker 3
I mean, one thing I would I would add is sort of two stages here. So if Parliament decides to to approve and designate the MPs, I think what we're also saying in planning terms is that the strategic need in case for expansion has, has been settled, and that should not be a matter for debate for the Planning Inspectorate as part of the DCO examination. And it's something we have seen with other tcos is that sometimes the need becomes a key part of the DCO examination and what we're signalling with this designation, although we are consulting on it so it's not decided yet, is actually that strategic need is settled.
The weight the government places on that is is done, and the DCO process, which will be the next stage in this, should be focusing on compliance with the MPs, the merits or otherwise of the application, the impacts and the mitigation.
The weight the government places on that is is done, and the DCO process, which will be the next stage in this, should be focusing on compliance with the MPs, the merits or otherwise of the application, the impacts and the mitigation.
09:56
09:56
09:56
09:56
09:56
09:56
Speaker 2
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Speaker 2
Yeah. Yeah. So the four tests apply, then the presumption applies. The other thing that I would say is, I know you mentioned it's a kind of novel designation. It is similar but not the same as the critical national priority infrastructure that is used in the energy MPs. So it is similar but but slightly different in terms of the way that it applies.
09:57
Steff Aquarone
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Steff Aquarone
Notwithstanding questions of legal advice, which I don't think we need to get into. Some of the evidence we've received has questioned whether the MPs actually demonstrates why it meets this definition. Aside from the cases in the four tests, which I know colleagues will want to ask about, because we have some deep questions about those, why is there not a standardized national test proving that this is the designation that's appropriate for this project? I think, Martin, you've just confirmed that when it gets if it's passed, then the DCO process will simply take it as a given that it is.
Where's that test?
Where's that test?
09:57
09:57
Speaker 2
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Speaker 2
I think that is the part of the purpose of the consultation. So we are asking through the consultation, do you agree? Do you agree with the case that we have set out? Do you agree with this designation? Give us your views. We've obviously received, as the Minister said, nearly 28,000 responses. We're going through the work of analysing those, and it will be kind of part of the final hemp.
09:58
Steff Aquarone
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Steff Aquarone
Yes. Okay. So those exceptional circumstances, which clearly include an acceptable risk to human health. Again, I'm sure colleagues will ask questions about this. Can you give any examples of circumstances where you expect the CNI would actually be outweighed by one of those tests? I don't think I don't really think it would be appropriate to kind of hypothecate in relation to what a potential application might look like, and therefore how it invalidated something on those specific grounds that the baseline proposition remains the same, that they would need to meet the four tests and meet all the legal requirements around the planning process.
And that's something that we take incredibly seriously. And I think this relates as well to a broader question around the sort of the government's approach to planning policy more broadly. And this is a conversation that we've been having with Lib Dem colleagues during the Civil Aviation Bill yesterday, where we had a really a really useful debate, I think, about their proposals around creating CAA Ombudsman, essentially, to make sure that we have got a lens that sits on top of planning decisions that relate to airspace change, where you are putting community impact right at the heart of it.
My concern in that regard, and I suppose it relates to this question today, is that the CNC designation allows you to say that the needs case around expansion has been settled, and on that basis, we can have a legal process which allows us to determine whether a decision has been taken in the right way and whether a promoter meets those needs not to kind of relitigate the kind of baseline question of whether expansion is required or not. If we get to that stage where designation goes ahead. Okay. So we want to get if we if this is the best thing for the country off the basis of this consultation and reflecting on the committee's recommendations, we need to get on with doing it.
And that's as much the case in airspace modernisation as it is with Heathrow. I don't want to test the chair's patience if she'll allow me. It's not just the airport opponents that are concerned about this designation. Trade bodies have said to us they would. They want greater clarity of the implications of this designation, including factors that might carry greater weight because of it. And that seems like a reasonable question. Are you saying that despite the assertion that this is critical national growth infrastructure, which was part of the announcement in the briefing earlier this year, that in fact that is subject to feedback and you will be willing to listen to concerns raised about that assumption which preceded the publication of the HEMS.
I'm saying that we are very glad to hear people's views on how Ngai designation affects the overall principle of Heathrow expansion, but also its broader implications for the planning framework. It still sits in the context of those four tests, but we are reflecting on the needs case, as set out in the PPS, which talks about how those economic benefits accrue from an expanded Heathrow if you meet the four tests. So I'm not sure I've really answered your question fully there.
I don't know.
And that's something that we take incredibly seriously. And I think this relates as well to a broader question around the sort of the government's approach to planning policy more broadly. And this is a conversation that we've been having with Lib Dem colleagues during the Civil Aviation Bill yesterday, where we had a really a really useful debate, I think, about their proposals around creating CAA Ombudsman, essentially, to make sure that we have got a lens that sits on top of planning decisions that relate to airspace change, where you are putting community impact right at the heart of it.
My concern in that regard, and I suppose it relates to this question today, is that the CNC designation allows you to say that the needs case around expansion has been settled, and on that basis, we can have a legal process which allows us to determine whether a decision has been taken in the right way and whether a promoter meets those needs not to kind of relitigate the kind of baseline question of whether expansion is required or not. If we get to that stage where designation goes ahead. Okay. So we want to get if we if this is the best thing for the country off the basis of this consultation and reflecting on the committee's recommendations, we need to get on with doing it.
And that's as much the case in airspace modernisation as it is with Heathrow. I don't want to test the chair's patience if she'll allow me. It's not just the airport opponents that are concerned about this designation. Trade bodies have said to us they would. They want greater clarity of the implications of this designation, including factors that might carry greater weight because of it. And that seems like a reasonable question. Are you saying that despite the assertion that this is critical national growth infrastructure, which was part of the announcement in the briefing earlier this year, that in fact that is subject to feedback and you will be willing to listen to concerns raised about that assumption which preceded the publication of the HEMS.
I'm saying that we are very glad to hear people's views on how Ngai designation affects the overall principle of Heathrow expansion, but also its broader implications for the planning framework. It still sits in the context of those four tests, but we are reflecting on the needs case, as set out in the PPS, which talks about how those economic benefits accrue from an expanded Heathrow if you meet the four tests. So I'm not sure I've really answered your question fully there.
I don't know.
10:01
10:01
Steff Aquarone
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Steff Aquarone
Okay. And the the biggest question, I suppose, is, is what's the precedent? What's the test to have arrived at this designation? Of course, if it goes ahead unchallenged, it will provide a precedent for future applications, to use the phrase . In the same way, we've got lots of precedents of where C and I is used. Are we likely to see more of these within the transport or other infrastructure claims? And if the growth case isn't able to be met, surely that immediately invalidates the classification.
10:01
Speaker 2
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Speaker 2
I wouldn't want to comment on whether or not we will see it again, because I think it would depend on the circumstances. As I as I've said, we have looked at other designations like C and P in the case of the energy sector, in considering whether or not there is a case for this, this designation, and it's something that we've included in the consultation.
10:01
Steff Aquarone
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Steff Aquarone
Okay. And, Minister, if if the growth case isn't met and we've already argued about whether the growth test should stand on its own or be sort of pre presumed by designation, if the growth test isn't met, surely that removes the designation because it is then not critical National growth infrastructure. Well any Heathrow expansion proposal can only go ahead if it meets the test around economic growth. So on that basis, I suppose the the the designation in the context of that application would not be proceeding.
Okay. Thank you.
Okay. Thank you.
10:02
10:02
10:02
10:02
10:03
10:03
Speaker 3
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Speaker 3
Yeah, obviously the Department for transport led to the review. We'd seen a similar designation used in other policy statements. So it was right as part of that review that we looked at whether Heathrow should or shouldn't have a designation to that effect. And then as part of the collective agreement for this process, we would consult other departments as part.
10:03
10:03
Steff Aquarone
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Steff Aquarone
I'm not sure we're able to say much more, other than it comes as a result of discussions between government departments, and then is subject to the right round process to achieve collective agreement. And therefore is the HMG position with DFT holding the pen on the PS, could you share with us the analysis that led to its use? Even if you can't share with us where it originated from, shall I take as a commitment that we'll take this away and see what we can share? Very happy.
Mr..
Mr..
10:04
10:04
10:04
Steff Aquarone
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Steff Aquarone
Well the PS as revised places a much greater emphasis on affordability. Any potential promoter is going to need to set out really clearly, clearly what their proposals mean in relation to things like airport charges, airlines, passengers, how they will manage key affordability risks, how they'll focus on efficiency, finance, ability of any projects. They're going to need to demonstrate that the charges are no higher than necessary to deliver the requirements of the scheme, that the charges that results are financially sustainable for both airlines, freight users and ultimately for passengers, that the level of charges to passengers are consistent with the scheme delivering the appropriate net benefits that are set out.
So across a we we've tried to design a framework that across both the range of potential costs, but also the benefits that are accrued, but also over the kind of timeline of what potential expansion could look like in phasing, how a promoter would be required to keep affordability central to their proposals, but also to keep costs at a reasonable level.
So across a we we've tried to design a framework that across both the range of potential costs, but also the benefits that are accrued, but also over the kind of timeline of what potential expansion could look like in phasing, how a promoter would be required to keep affordability central to their proposals, but also to keep costs at a reasonable level.
10:05
10:05
Steff Aquarone
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Steff Aquarone
No. Certainly not. It's just that we're existing in a context where Heathrow Airport is absolutely critical to the UK economy, to the flows of freight, and to our broader connectivity to the world. In that context, if expansion goes ahead, we need to make sure that it does so in a way that makes good business sense for the airline to operate through. Heathrow makes good sense for the passengers who.
10:06
10:06
Steff Aquarone
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Steff Aquarone
I think it's it's common through planning policy for major infrastructure projects to ensure that financial risks are mitigated to the greatest extent possible, and that affordability is central to the potential schemes that promoters put forward. I think that that's incumbent upon any UK government that's setting a planning policy framework to ensure that those things are central to a promoters considerations, especially because we've seen through evidence given to this committee, but also the discussion that we've had today, how the the downstream impact, how the flow of decisions that are taken at Heathrow Airport affect job creation in the local area.
They affect businesses in the local area, but they have greater impacts for London and actually for the entirety of the United Kingdom. So we've got a responsibility to think through that lens.
They affect businesses in the local area, but they have greater impacts for London and actually for the entirety of the United Kingdom. So we've got a responsibility to think through that lens.
10:07
Speaker 4
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Speaker 4
So going into all the details, because it will come later. I mean, I guess attention is if it starts to become unaffordable, you might come under pressure to relax the sound mitigation measures that are funded by the airport, or you might become more relaxed about air quality. And all these factors to help reduce affordability is that is that is that a serious concern? Should I be concerned about that? To reduce affordability, local residents may be paying the price.
10:07
Steff Aquarone
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Steff Aquarone
I don't think I don't think you should be concerned. And that's because we're trying to design a scheme today that ensures that affordability is accounted for over the lifetime of the project, and also that promoters plans are credible. The four tests that apply when a potential scheme is put forward for approval continue to apply during the lifetime of the project's delivery and in that sense, must be abided by. Also, the four tests relate to targets, and I'm sure that we'll will come to greater discussion of the climate test later, which are many of which are legally binding upon the UK government.
So if you take something like the climate test, it's got to ensure that Heathrow expansion is facilitated in such a way that it ensures that we can remain compliant with our carbon budgets, which are, of course, legally binding, and that the UK government meets its net zero 2050 target, which is also a legally binding target. So you, you we are trying to create a framework that will ensure that you can't have slippage around the edges and can meet the concerns that you might have.
So if you take something like the climate test, it's got to ensure that Heathrow expansion is facilitated in such a way that it ensures that we can remain compliant with our carbon budgets, which are, of course, legally binding, and that the UK government meets its net zero 2050 target, which is also a legally binding target. So you, you we are trying to create a framework that will ensure that you can't have slippage around the edges and can meet the concerns that you might have.
10:08
Speaker 4
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Speaker 4
Yeah, I guess we'll come back to Net-zero later as well. The but on the affordability at the start, you're saying this will be assessed through the lifetime of the project. You mean when it's in operation. So I guess that's that's a function of the regulator isn't it, to check affordability to make sure that the they're not abusing that monopoly position. I guess it's not quite a monopoly, but it dominates the aviation market in London doesn't it, Tim? At last chance to say something.
10:09
Speaker 1
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Speaker 1
So the CAS job is to look after the interests of consumers. That's set out in the duties and the legislation we operate under. That's both kind of passengers, but freight users as well. And part of our approach will be to subject any costs for expansion to rigorous scrutiny and efficiency tests, and make sure costs passed on to consumers are only those that are efficient and in the interests of consumers. Part of that will also be taking into account any planning conditions that are set through the process. I think you talked about a number of sort of potential areas there, and that is clearly part of the input that we would take in assessing whether those costs are efficient.
But clearly we would be expecting any promoter that receives a D, C, o through the through the process set by Parliament and government to abide by those conditions, but deliver those costs and those requirements in an efficient way.
But clearly we would be expecting any promoter that receives a D, C, o through the through the process set by Parliament and government to abide by those conditions, but deliver those costs and those requirements in an efficient way.
10:10
10:10
Steff Aquarone
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Steff Aquarone
Well, affordability, I think, in our view, is something that needs to be built in throughout the planning process. It's also highly dependent on the particulars of a scheme that's put forward by a potential promoter. I think the four tests, as they stand, allow you to have a sort of a a macro view on the issues of most consequence, both in terms of the context of the UK economy. UK government's kind of unashamedly policy focused.
10:10
Alex Mayer
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Alex Mayer
Okay, so I've got a question for Tim on the CAA. You're consulting on developing the regulatory framework for Heathrow Airport and with the intention of incentivising cost effective delivery of any improved expansion scheme, which would be, I think, cost effectiveness would be very of great interest to the airlines and other tenants at Heathrow who don't feel they're getting value for money. I think you probably know that. So is it important or even possible for the proposed regulatory model to be agreed before the NPS is finalised?
10:11
Speaker 1
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Speaker 1
We've had an established regulatory framework in place for Heathrow for a number of years. We have been consulting on over the last year, some potential changes to that framework because we recognise, given the scale of investment that is needed, both in the existing two runway operation, but also in the context, in the context of expansion, that some improvements to that framework could be made. On the 9th of October, we published our document setting out those areas or those elements of the framework that we think we could improve on that include includes capital governance. So that's how projects are decided and governed.
And how do you set an efficient baseline for the costs. We're looking at the benefits of establishing a longer term framework that might support an expansion of this nature. We're looking at how we could introduce competition and stronger procurement requirements to help deliver value for money. So we've got a programme of work over over the next next year, we will be working with stakeholders on all of those, all of those changes. They will be subject to further consultation before being implemented.
And how do you set an efficient baseline for the costs. We're looking at the benefits of establishing a longer term framework that might support an expansion of this nature. We're looking at how we could introduce competition and stronger procurement requirements to help deliver value for money. So we've got a programme of work over over the next next year, we will be working with stakeholders on all of those, all of those changes. They will be subject to further consultation before being implemented.
10:12
Alex Mayer
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Alex Mayer
Yeah. Okay. So I'm trying to work out if that's tinkering around the edges or not, because Rab residual asset base models are often seen in, particularly in the case of Heathrow as delivers very poor value for money. And the the investors have completely. De-risked did you look at other models that for delivery of this project.
10:12
Speaker 1
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Speaker 1
We have looked at a range of other models. The Rab based model has some advantages in that. It's well understood by markets. It's used across multiple regulated sectors over a long period of time. So it's well understood by investors. But we absolutely have accepted the challenge that the regulatory model could work harder. And that's why we are setting out that short list of options to really strengthen the governance and the efficiency sort of incentives in that framework.
10:13
10:13
Speaker 1
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Speaker 1
We have not presumed that Heathrow Airport would be the chosen operator model. In particular, model seven be anticipates the prospect of a promoter other than Heathrow Airport securing a DCO and developing the. The airport. So we have. As the CEO, we've remained neutral to the outcome of any planning process.
10:14
10:14
10:14
Speaker 1
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Speaker 1
So we're at an early stage of the of the process. I know that I'm aware that there are a number of numbers that So we're just in an early stage of the of the process. I know that I'm aware that there are a number of numbers that the promoters have, have, have made public think of, of view is that there are some really important issues of scope of the scheme, some of the mitigations that may be. required have not yet been settled. And if we look at other kind of major infrastructure projects and some of the lessons learned from that.
getting robust sort of cost. estimates is only possible once you've resolved those kind of big scope questions. That said, we're very mindful of affordability. We've heard the argument that the airlines have made, and our job will be to make sure that any costs that are pass on to. consumers are efficiently incurred and necessary to secure the the.
getting robust sort of cost. estimates is only possible once you've resolved those kind of big scope questions. That said, we're very mindful of affordability. We've heard the argument that the airlines have made, and our job will be to make sure that any costs that are pass on to. consumers are efficiently incurred and necessary to secure the the.
10:15
Jacob Collier
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Jacob Collier
Benefits of the proposed expansion scheme. The MPs says that the charges should be no higher than. necessary and financially sustainable, but that doesn't exactly. If I was an airline, it doesn't exactly give me much. confidence in that. This will be as low as possible, especially given Heathrow is already the most expensive in the world. So when are we going to see that.
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Speaker 1
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Speaker 1
And to set out, and therefore, once the scope is is sort of settled, we would expect them to come forward with our proposals and to include cost. estimates at that point in time. And I think I'd say that was when we would have a higher degree of confidence that we know what the costs could be. That will be then part of the DCO designation.
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Steff Aquarone
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Steff Aquarone
The efficiency incentives and the regulatory framework works hard for consumers. And I think just to add to that briefly, Jacob, there's there's also an important factor around when in the process, those. questions around what is affordability? What what constitutes being no higher than necessary apply. That's to do with the specifics of a scheme as they're put forward. But it's also highly. dependent on the macro context in which airlines and air passengers are travelling through Heathrow Airport. I think one of the lessons that we've seen from the Covid 19 pandemic through to the disruption that we're seeing in the Middle East and its impacts upon the aviation sector now, is that the ability to absorb potential charges and costs is dependent on the the health of airlines and of passengers capacity to pay.
And that changes over time as well. So it's it's better focused at a moment where you can be more you can be more assured of what the actual context is of what airlines and passengers are facing to be able to definitively, and in a more prescriptive fashion, say exactly what. constitutes no higher than no higher than necessary, and what airlines are able to meet, if that makes sense. It's got to be reflective of the. situation that those operators are facing. And can I just. reiterate that given everything that the government has been doing around emergency slot reform about support for airlines in that context, but also the civil aviation bill helping us be more supportive in the future?
The financial health and growth for our airline sector is something that we take incredibly.
And that changes over time as well. So it's it's better focused at a moment where you can be more you can be more assured of what the actual context is of what airlines and passengers are facing to be able to definitively, and in a more prescriptive fashion, say exactly what. constitutes no higher than no higher than necessary, and what airlines are able to meet, if that makes sense. It's got to be reflective of the. situation that those operators are facing. And can I just. reiterate that given everything that the government has been doing around emergency slot reform about support for airlines in that context, but also the civil aviation bill helping us be more supportive in the future?
The financial health and growth for our airline sector is something that we take incredibly.
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Jacob Collier
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Jacob Collier
Planning determination when we get to the specifics of the matter as well, is there any sort of maximum level of increase that you would be comfortable with? Because obviously it's going to get to a level where for airlines it's not sustainable. And so we've constructed this third runway, which has increased airline charges to pay for it, and there'll be reduced passengers as a result of that. And we've heard from the Cambridge Economic Policy Associates that this could rise by .
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Steff Aquarone
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Steff Aquarone
So is there a maximum level that you're comfortable with? Well, sort of as I've already said, it depends on how the. benefits measure against the costs, the ability of airlines and passengers to absorb potential costs are different depending on when you get to an approved policy framework or, sorry, an approved application for. expansion at Heathrow. So I'm not in a position today to say, oh, in six years time, when you take a policy proposal and approve it or disapprove it, you know that level of charge will be more or less acceptable. You have to deal with both the circumstances of the economic context in which the planning decision is being taken, but also the perspective for UK aviation at that moment, and the airline to use the airport and the passengers who use it.
So I don't feel like I'm able to go much further at this stage, other than to say those questions about.
So I don't feel like I'm able to go much further at this stage, other than to say those questions about.
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Steff Aquarone
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Steff Aquarone
Do you not see this whole issue as a risk to the whole project? It is a risk, absolutely. And that's why the MPs is designed to try and deal with the practicalities of that risk to the greatest extent possible in terms of the. affordability provisions that are built into the system. But I do also think that there's utility and merit in the existing approach, which is dealing with the the realities of an application when it occurs in the economic context of what airlines are facing, is a better way of doing it than sort of prejudging it through the MPs at this stage in a way that might produce a figure which is sustainable now.
But we have seen from what happens in aviation across the world over the last. 6 or 7 years, that that might not map into the future. So being more .
But we have seen from what happens in aviation across the world over the last. 6 or 7 years, that that might not map into the future. So being more .
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Speaker 1
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Speaker 1
That regard, there could be utility. It could be argued in that approach. Thank you. And if I might add, what we've seen at the moment, we've obviously got a number of two promoters with different ideas about sort of scope and approach to the scheme to meet the. requirements in the MPs. And those different schemes might offer a different set of sort of benefits and, and, and costs, which I think is another reason not to sort of reach too prematurely for a particular number. But as the minister said, certainly from a CAA perspective and thinking about the lens of the consumers and what's efficient for consumers and allowing those benefits to to be delivered.
affordability and cost efficiency will be as well as any .
affordability and cost efficiency will be as well as any .
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Steff Aquarone
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Steff Aquarone
Process will be absolutely key. Right, Steph? Which builds very nicely into my next question. So delayed to construction, cost overrun those sorts of things. How would that affect your assessment of the. affordability of this project, Minister? Well, we're trying to design a project which. ensures a that. contingencies can be effectively dealt with and that you can still have. affordability built into it.
I would also say it's the responsibility of the promoter to put forward a scheme that is sufficiently credible to allow for us to have.
I would also say it's the responsibility of the promoter to put forward a scheme that is sufficiently credible to allow for us to have.
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Steff Aquarone
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Steff Aquarone
Well, to have a high level of. confidence that that scheme can be delivered in a way that's both cost. effective and practically effective in terms of construction. And the decision making authority will look at a scheme on that basis and try, to the greatest extent it can to ensure that affordability is is is baked into those. considerations ahead of any. approval and may, may or may not put in conditions which centre on that question around affordability as well. So it's an incredibly important consideration and the department's not taking any chances. There's a tender out for a consultant to be able to start to look at this sort of risks and exposure to programme costs and cost overruns.
If the department doesn't get a clear, reassuring response from that, does that mean that its view on Hemps or Hemps itself could look quite different? Well, I suppose I would return to the fact that there is a binding test on Heathrow expansion, which ensures that it facilitates economic growth in the context of. If a project were not to be financially sustainable, I think that there's a. There's a question about what the interplay is between those two factors. Ultimately, however, schemes that put that are put forward by promoters have to be credible in terms of financial ability, affordability and deliverability.
So the government could put some money towards it. If the case for growth is really strong. That's different to what the Secretary of State said earlier this year about all costs, including access costs, surface access costs, infrastructure costs would be borne by the promoter. With respect, that's not exactly what I said. This project will have to be privately financed, and the government's been very clear about that throughout. So your answer just previously that, you know, looking at economic growth case, can you be really clear that's still the case. So if you're not if the department is not satisfied that it wouldn't be exposed to unreasonable costs and hence proceeds on the current basis, it would still be the matter of record that the department will not be using taxpayers money to fund it.
This project has to be privately financed, and we've been clear on that throughout. I'm merely reflecting on the fact that there are two concurrent. considerations which have to be factored into any decision around making sure that a project meets the economic growth test, whilst also making sure that it is affordable, financeable. deliverable and coherent. Indeed, indeed. But but but.
If the department doesn't get a clear, reassuring response from that, does that mean that its view on Hemps or Hemps itself could look quite different? Well, I suppose I would return to the fact that there is a binding test on Heathrow expansion, which ensures that it facilitates economic growth in the context of. If a project were not to be financially sustainable, I think that there's a. There's a question about what the interplay is between those two factors. Ultimately, however, schemes that put that are put forward by promoters have to be credible in terms of financial ability, affordability and deliverability.
So the government could put some money towards it. If the case for growth is really strong. That's different to what the Secretary of State said earlier this year about all costs, including access costs, surface access costs, infrastructure costs would be borne by the promoter. With respect, that's not exactly what I said. This project will have to be privately financed, and the government's been very clear about that throughout. So your answer just previously that, you know, looking at economic growth case, can you be really clear that's still the case. So if you're not if the department is not satisfied that it wouldn't be exposed to unreasonable costs and hence proceeds on the current basis, it would still be the matter of record that the department will not be using taxpayers money to fund it.
This project has to be privately financed, and we've been clear on that throughout. I'm merely reflecting on the fact that there are two concurrent. considerations which have to be factored into any decision around making sure that a project meets the economic growth test, whilst also making sure that it is affordable, financeable. deliverable and coherent. Indeed, indeed. But but but.
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Speaker 2
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Speaker 2
That's the that's the reason we are engaging in this process. When the Climate Change Committee came here, I think I think they said that the view that the omissions would be dealt with holistically within the wider economy, their view that that that that could not be done without the government investing in other industries, particularly.
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Steff Aquarone
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Steff Aquarone
It's going to be the government just very quick answer to that because we're coming on to climate. Okay, cool. So I'm not I. suppose what I would say about that is Heathrow. expansion is factored in, along with a range of other expansion projects to our modelling around carbon budgets. It constitutes a sort of a slice of the pie in carbon budget compliance, which needs to be met. But ultimately, the way that we meet our overall goals of compliance is through economy wide measures.
Some of those are in the transport .
Some of those are in the transport .
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Alex Mayer
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Alex Mayer
Is done. So there's very limited scope for finding those emissions, isn't it? Sorry. Yeah. No. Okay. But we're going to come let's come on to the climate test, Alex, and come back if you. Thank you. Chair. In order to pass the climate test, the draft states that any proposed scheme must not. materially impact the UK's ability to meet the legally binding carbon budgets.
Can you explain what. materially impact looks like in practice, and are you able to give us any. practical example of what might .
Can you explain what. materially impact looks like in practice, and are you able to give us any. practical example of what might .
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Steff Aquarone
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Steff Aquarone
Cause a Heathrow. expansion scheme to fail the climate test? Thank you. So the first thing I would say is that the the the notion of. materiality applies in planning in a subjective context. And the question of whether a scheme. The increase in carbon from a proposed scheme, when assessed against the UK's legally binding targets, would have a material impact on meeting them. That question around materiality would need to be taken by the decision maker in the context of what that specific proposal scheme's impacts are upon the UK economy, in terms of whether or not a scheme can be approved on the basis of the climate.
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Steff Aquarone
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Steff Aquarone
But the framework against which the climate test is judged is tangible, is measurable and is in statute in the United Kingdom already. So that would be our net zero obligations by 2050. It's about carbon budget. compliance over time. So although the question of materiality is subjective to a particular proposal, the the framework against which it's assessed is measurable. tangible and exists in statute in terms of compliance for the UK government. So hopefully that provides a useful .
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Steff Aquarone
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Steff Aquarone
Example of how any given scheme could fail the climate test? Well, if your scheme, when assessed against the UK's legally binding climate, legally binding carbon budgets creates a material impact on on the UK not being able to meet them, that is the basis upon which you would fail the scheme. I suppose the way in which that flows through into the particulars of a DCO. application you'll be expected to. To mitigate climate impacts, you'll be expected to have credible plans about how you do so. You'll be expected to have a surface access strategy, which has stretching, public transport mode share targets.
All of these things will be taken in the round. I suppose what I'm saying is that there is this very firm. baseline in regards to being measured against the the the headroom of carbon budget compliance and the net zero target of whether or not a .
All of these things will be taken in the round. I suppose what I'm saying is that there is this very firm. baseline in regards to being measured against the the the headroom of carbon budget compliance and the net zero target of whether or not a .
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Alex Mayer
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Alex Mayer
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Steff Aquarone
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Steff Aquarone
Or fail too early on into the life of the entire project? And I wouldn't argue that's the case for a couple of reasons. The first is that, of course, one of the measures against which we measure compliance with the climate test would be whether or not it's consistent with us meeting our legal obligation to achieve net zero by 2050. But 2050 is not the cutoff point after which carbon emissions do not factor in. consequentially to the overall carbon impact of the scheme.
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Steff Aquarone
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Steff Aquarone
Any Heathrow expansion proposal will have to meet. expected carbon budget. targets and that would include CB eight as well. So, and those carbon impacts have to be measured over the entire lifespan of the project. So although the climate test has a as a sort of a 2050 hook, it does go further than that.
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Speaker 3
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Speaker 3
And I don't know if there's anything else to to add on that particular question, I will say that even passing the climate test doesn't mean that you don't have to set out a whole plan for how you're going to mitigate the residual impacts over the lifetime of the scheme, and the decision maker still needs to be satisfied that that mitigation package is. acceptable as part of that .
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Steff Aquarone
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Steff Aquarone
Especially how these manifest themselves in aviation policy, and that also factors into our review of the jet zero strategy, which is which is going to be underway. The difficulty that we have, and you're right to say that designers have set out a metric by which a multiplier, a multiplier could be applied, is that scientific uncertainty still remains over some of these questions. And there is sort of debate over what metric is best used to measure these factors as well. That doesn't mean that it's something that we're not cognizant of and need to think best about how to address through the MPs.
This is one of those ones where, in the context of the recommendations from the CDC, but also the. 27,000 other responses that we've had is certainly something that we're going to take away and consider as part of the. consultation and .
This is one of those ones where, in the context of the recommendations from the CDC, but also the. 27,000 other responses that we've had is certainly something that we're going to take away and consider as part of the. consultation and .
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Steff Aquarone
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Steff Aquarone
The and please do correct me if I'm wrong. I was just going to I know I'll just say this briefly then, and then Hannah can correct me if I'm incorrect. I think that wherever we are in the in the process and any potential. application under the DCO process, any application will still have to have account for policy documents and reviews and strategies that emanate from HMG, one of which will be the reviewed jet zero strategy. Non-co2 impacts do need to have an ongoing application to the way that we think about emissions in aviation policy, whether that be through climate warming, impacts of contrails or whatever else.
So it will have to have .
So it will have to have .
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Speaker 5
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Speaker 5
Regard to that as we move through this process. But Hannah, feel free to feel free to I was poised the two things I was just going to add, I think one is that any applicant would have to address those impacts in a qualitative way, given that there is no agreed framework. And then, as the Minister said, if there were an agreed policy at the time of.
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Speaker 2
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Speaker 2
Qualitative assessment recognising the debate. But that is a bit bonkers. And the two applicants can just do their own assessment completely independently. And then when it comes to assessment, you're left assessing two pieces of analysis which might be done completely differently. But let's face it, people who have an interest in the scheme going ahead, is it not better that we just set out clear guidelines and accept that there might be some uncertainty in them, and we use .
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Speaker 3
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Speaker 3
Frameworks are for for these. Is there a timeline for that being delivered? I was going to ask. The tests have been designed to be measurable against legal. standards and things, and where we don't have a legal standard, it makes it difficult to incorporate something into that test. When we want those .
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Steff Aquarone
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Steff Aquarone
Sum of money. So why is there no delivery date for that? Well, as I say, this is looking at matters that are around which there are significant scientific uncertainty. A lot of the research that we're doing is also in collaboration with external partners from HMG. And actually a lot of this work also takes part on takes place, forgive me on an international level through ICAO, but I think it's a fair challenge to to ask for more specificity. So chair, with your permission, I'll certainly take that away and write to you about it. Just one of the factors I was going to add, though, from the perspective of a potential promoter, and I wouldn't want to presume what a potential promoter will or will not think about their application, but I would have thought that you would rather hedge on the side of having a comprehensive plan to deal with non CO2 impacts, rather than having one that doesn't pass muster, which you need to then.
retrospectively make a lot better.
retrospectively make a lot better.
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Steff Aquarone
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Steff Aquarone
Being up in the you know, upper atmosphere, I would have thought, but also accounting for technological advances in aviation as well, which has an implication for, for noise. And I think there's international studies that show technology reducing by. 0.1 to 0.2 decibels the the noise of large jets over X many years. And that needs to be factored into. So you're right to .
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Alex Mayer
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Alex Mayer
Say that there need to try to plan for that uncertainty, I suppose. Alex. Thank you. Chair. The Secretary of State recently said that Heathrow expansion is compatible with carbon budgets because emissions can be offset holistically elsewhere. But the Climate Change Committee told our committee that there wasn't really another. realistic source in the economy to offset against.
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Steff Aquarone
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Steff Aquarone
Can you clarify what you think the Secretary of State meant? Yes, I think the Secretary of State was. reflecting on the fact that the UK's climate targets are ones which are economy wide, so it's important to look holistically at how those emissions are reduced across the whole economy. It's also worth saying that the way in which we are dealing with our slice of the. The challenge in regard to this is through a range of projects which sit across.
Department for Transport Equities, one of which for which I used to have.
Department for Transport Equities, one of which for which I used to have.
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Steff Aquarone
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Steff Aquarone
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Steff Aquarone
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Steff Aquarone
With our carbon budget. requirements as a whole, of which Heathrow expansion would form a. constituent part. And that requires us within the Department for transport to place greater. emphasis on technologies which would best. facilitate mitigation and removal, such as GRS, but also to carry on with the work that we're doing around the SAF mandate and other measures to ensure that we have compliance with carbon budget through aviation policy. So I think the Secretary of State was merely reflecting on the fact that these considerations have to be taken in the round in terms of all the work that the government is doing to facilitate compliance.
Heathrow expansion is .
Heathrow expansion is .
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Steff Aquarone
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Steff Aquarone
It's both those things. Well, I believe I believe that the SEC said that a credible route to Heathrow expansion would have to have a larger role for GRS as part of that process. And at present, our aviation policy in the round doesn't meet that requirement. I and happy to be corrected. If that's not the case, to which I would say it's a fair challenge. And therefore the work that we're doing through the refresh of the Jet zero, the Jet zero review, the work on sustainable aviation fuel, the work that we do with private sector partners to think about aerospace technology and how we might better increase sustainability and efficiency that way, the way in which we facilitate airspace modernisation, which will lead to greater.
efficiencies and saving of carbon emissions in how we manage our antiquated and out-of-date airspace. All of this needs to be taken together to create an aviation picture, which facilitates our compliance with .
efficiencies and saving of carbon emissions in how we manage our antiquated and out-of-date airspace. All of this needs to be taken together to create an aviation picture, which facilitates our compliance with .
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Speaker 3
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Speaker 3
So in fact, it may be better for somebody else to pick this one up. No, I mean, just to reiterate what the minister said, this is this is managed across the economy. That Secretary of State for Desnos is responsible for managing those carbon budgets economy wide. The Heathrow expansion National Policy statement has been subject to collective agreement, and we've worked. together with them on that. They will work closely with us as part of the Jet Zero strategy review, where that will be considered as well.
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Steff Aquarone
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Steff Aquarone
So I don't think there's anything further to add to what the minister said, other than that, I suppose I would also just add to what I add to what I said just by saying that the Whitehead review, in its emphasis on gas, has also, I would say, materially changed the the the focus on how we might best collaborate on a cross-government basis to. facilitate greater emphasis on removals. The DFT is advancing .
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Alex Mayer
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Alex Mayer
Work in that space, and we hope to have more to say about it next year. And the Climate Change. Committee's existing plan for reaching net zero already relies on removing a considerable amount of CO2 a year from the atmosphere. Do you have complete confidence that that technology is going to be available .
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Steff Aquarone
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Steff Aquarone
In time, given the. additional extras we're going to need as well? I think you're right to raise the challenge that the amount of GR removals that are required to facilitate compliance with carbon budgets is a real challenge. It is quite stark, and therefore, we need to do everything that we can from an HMG. perspective to facilitate greater uptake, development of those markets and the mechanisms by which they can be facilitated. We also can't be. complacent in terms of just putting too much stock in one particular technology. That's why we're reviewing the jet zero strategy. That's why we are modernizing our airspace.
It's why we've created a world leading model for the production of sustainable aviation fuel. And the government is working very. collaboratively with the private sector in issues to do with alternative fuels, electronic flights, whatever else. So we need a range of levers to pull in order to ensure compliance. But you're right to say that GRS need to make up a larger share than may have been previously thought. When we used to discuss these questions in the past.
Therefore, the .
It's why we've created a world leading model for the production of sustainable aviation fuel. And the government is working very. collaboratively with the private sector in issues to do with alternative fuels, electronic flights, whatever else. So we need a range of levers to pull in order to ensure compliance. But you're right to say that GRS need to make up a larger share than may have been previously thought. When we used to discuss these questions in the past.
Therefore, the .
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Steff Aquarone
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Steff Aquarone
I think that's perhaps the wrong. If you'll forgive me, the wrong way to to look at the question. It's not as if we have just a cap and we need to say, well, we'll put x amount here, x amount there. I think the Secretary of State's reflection was on the fact that in terms of both carbon budget compliance, but also emissions, which are released through wanting to facilitate growth in the.
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Jacob Collier
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Jacob Collier
That these factors are taken into account. Okay, Jacob. Yeah. Thank you. The Climate Change Committee's advice is that the aviation industry should bear the costs of the. decarbonisation measures necessary to fulfil our climate obligations. And as we touched on previously on the airline, charges will increase to pay for the cost of the third runway, but also the industry will have to pay towards decarbonisation.
So what assessment have you made of the potential. implications of that?
So what assessment have you made of the potential. implications of that?
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Steff Aquarone
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Steff Aquarone
On the. affordability of Heathrow expansion? Well, I'll only say a little bit on this and then I'll pass it over to to to Hannah and Martin. But it's ultimately for the promoter to set out how they're going to build a scheme that is affordable and proportionate for users of the airport, and that includes airlines. I would say that airlines are actually also taking forward lots of very positive work in this space to meet. decarbonisation obligations as it relates to their business. practices as they stand, whether that be working very productively with the government in terms of.
compliance with the SAF mandate and design of the RCM, or investments they're doing into renewal of their fleets, which lead to carbon efficiencies and savings, to the collaborative approach they've taken to airspace. modernisation at which we prioritise carbon as one of the main factors that should be judged when thinking about how to modernise our airspace. So they're already doing a lot of work in this space. We're of the view that the the kind of north star of. decarbonisation can bring efficiencies and therefore cost savings for the aviation sector as a whole. And I don't think that that can be.
discounted either. But as I say, ultimately it's for the promoter to make sure that the affordability of .
compliance with the SAF mandate and design of the RCM, or investments they're doing into renewal of their fleets, which lead to carbon efficiencies and savings, to the collaborative approach they've taken to airspace. modernisation at which we prioritise carbon as one of the main factors that should be judged when thinking about how to modernise our airspace. So they're already doing a lot of work in this space. We're of the view that the the kind of north star of. decarbonisation can bring efficiencies and therefore cost savings for the aviation sector as a whole. And I don't think that that can be.
discounted either. But as I say, ultimately it's for the promoter to make sure that the affordability of .
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Steff Aquarone
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Steff Aquarone
As a two runway airport, let alone a three runway airport? Yeah, it's a fair challenge. There's firstly, the well, I suppose there are different constituent parts of how they might get to improving their processes. Maybe if I just separate it momentarily from from the process. The airlines that operate at the airport can go after. decarbonisation gains as it relates to .
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Steff Aquarone
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Steff Aquarone
But ultimately staff is being used in the UK at the moment. I don't have that figure off the top of my head. I'm sorry. Well, well, but we are getting to a stage where SAF production in the UK is starting to become a reality. FSF is, of course used to meet compliance under the SAF mandate. I was also I was just going to say as well that Heathrow. You're right to raise the challenge that grid connectivity is a major barrier to airport decarbonisation. It's why we work very closely with Nisa and Ofgem. The Prime Minister, of course, recently announced that he was going to facilitate the creation of Great British Grid, which will better allow us to have a competitive market to to prioritise connectivity.
But it's a .
But it's a .
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Speaker 5
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Speaker 5
Completely fair challenge to say that there's much further to go, and I don't know if there's anything to add. The only the only thing I would add is that in in the course of putting the application forward for expansion at Heathrow, they will have to. demonstrate how they will mitigate the carbon impacts at the airport. And that would include things like investment in investment in greenhouse gas removals that we've talked about, their support for the production and use of SAF, but also how they are. decarbonising their own fleet and their own activities at the airport.
Those would all be things that we would expect them to bring in their application for consent. I appreciate that doesn't go to the question of the airport as it stands, but in terms of.
Those would all be things that we would expect them to bring in their application for consent. I appreciate that doesn't go to the question of the airport as it stands, but in terms of.
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Scott Arthur
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Scott Arthur
Has said, thank you very much. Just come back on to this. question that you responded to from from Alex about the responsibility. So Desnos has the legal. responsibility for the climate emissions. Can I clarify that one? When the Secretary of State has sort of. suggested that the reduction in emissions can be deferred elsewhere, is that internal within the.
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Steff Aquarone
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Steff Aquarone
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Steff Aquarone
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Steff Aquarone
So this is part of a broader economy. She is going to have to do it within this. Sorry, I understand I understand what you're saying. And we you're right to say that the Climate Change Committee's advice was centered on the fact that when they talked about the viability of Heathrow expansion, it was in an overall context of.
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Steff Aquarone
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Steff Aquarone
Not at present having the right suite of measures to be able to meet our carbon budget compliance. responsibilities as the Department for transport. That is true, and therefore that's why we're advancing work to refresh the jet zero strategy to advance this other work in staff and airspace modernisation. So, yes, absolutely. I was just merely reflecting on the fact .
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Scott Arthur
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Scott Arthur
That when it comes to who is responsible in the UK government for managing the overall process. Well, appreciate that clarification. But on those points, and you made a compelling case about many of the other things that have to happen. But the Climate Change Committee are absolutely. clear that you must that you would need to legislate for those other.
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Steff Aquarone
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Steff Aquarone
Similarly the conversation on Jaegers, will you do that? That's the question. We're currently undertaking a review of the SAF mandate along with stakeholders. And I'm not in a position today to be able to say what we may or may not do as a result of that, but we are willing to. legislate where we feel it is in the best. interests .
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Steff Aquarone
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Steff Aquarone
Of whether it's nice to do. They're saying it's legally must do. Well, we'll reflect on what the Climate Change Committee has said through their evidence and respond to it formally as a result of this consultation. But I have certainly taken what you've said on board and across the piece. Irrespective of that, we are advancing lots of work to meet those.
10:53
Scott Arthur
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Scott Arthur
Decarbonisation objectives, many of which you are right to say do need to be put through statute. Yeah, and I mean, we've just seen the government announced today. about the moving ahead with jackdaw. That's four years after it was originally announced, because there was a legal challenge. Now. jackdaw is a tiny novel in comparison to the mountain of. emissions that will come out of Heathrow. Do you not see that if we don't have if the government doesn't have all its ducks in a row on this, there's just no prospect of this happening. It will just get bogged down in the courts.
So, I mean, what thought has been given to how likely this is to actually happen if you don't have in place .
So, I mean, what thought has been given to how likely this is to actually happen if you don't have in place .
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10:53
Steff Aquarone
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Steff Aquarone
Of these measures before trying to approve the DCO. I think this buttresses the point that was made by the Secretary of State, that the question of Heathrow expansion does sit in this economy wide context of carbon emissions. And you are also right to say that any questions around. expansion have to be taken in the context of the UK's legally binding climate commitments, and therefore you have to think about the relation of these different pieces of the of the .
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Scott Arthur
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Scott Arthur
Puzzle of compliance, as it were. And think about it holistically. That is crucially important, but you are sort of admitting that many of the things that will make this credible. environmentally are not yet in place. And so doesn't it follow that it's impossible to approve a DCO. until those those measures that you've referred to there are .
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Steff Aquarone
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Steff Aquarone
In place, some of which are going to take quite a bit of work from where we are right now. Well, the questions around potential. designation of the hemp, which lead to questions around when a DCO. application might be received, considered and then approved, are ones that would happen necessarily in subsequent years to where we are currently. We've already got a lot of work under our belt in terms of meeting aviation share of. decarbonisation measures, particularly through the SAF mandate, the creation of the UK Airspace Design Service and the work that we're progressing in that space.
But a lot of work needs to be done across the piece to facilitate aviation decarbonisation. And Heathrow expansion, of course, happens in that context. I'm aware of the the trade offs, the difficult balancing act and the.
But a lot of work needs to be done across the piece to facilitate aviation decarbonisation. And Heathrow expansion, of course, happens in that context. I'm aware of the the trade offs, the difficult balancing act and the.
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Scott Arthur
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Scott Arthur
Is very determined to meet them. And Heathrow expansion exists in that context. Yeah. Now, you've been speaking about the climate tests as though they are tests for Heathrow. But I mean, isn't the climate climate test essentially a test for government policy more than actually what is within the ability of the developers to to manage? Do you see that .
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Steff Aquarone
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Steff Aquarone
And the test exists to ensure that a proposal that is brought forward meets the. framework that the government has has set. So it's a it's a test for promoters and a test for the. A test on the basis by which expansion can happen. But you're right. So that it's in the context of a legal framework that .
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Scott Arthur
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Scott Arthur
Government has created to meet our own objectives around decarbonisation. Yeah. And I mean, if the targets for SAF carbon. pricing . , for route. modernisation and so on have not been met, then the, the the provisions won't be sustainable. So I mean, what is the sort of. contingency plan and at what point would government sort of.
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Steff Aquarone
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Steff Aquarone
We reflected on the fact that any Heathrow. expansion process would have to pay. cognizance and due regard to policies of the government that were in place when that decision was taken and as that process unfolded. So when you come to the moment where a potential DCO application was analyzed, that would be in the context of where exactly we are in terms of the carbon budget picture, in terms of extant UK government policy around the net zero framework, we would be in a different place if it was in the future in regard to SAF provision and production in the United Kingdom.
And you're right to say that decisions would have to be taken in that context and on that basis, in relation to how that links into the tests. That's how a.
And you're right to say that decisions would have to be taken in that context and on that basis, in relation to how that links into the tests. That's how a.
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Speaker 3
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Speaker 3
In the round also in development of aviation policy. I don't know if there's anything further to add. The minister is correct. We carefully considered the EC report and government responded and referred to the MPs review in a lot of its responses. I think you can see in the draft MPs sort of by establishing clear air. quality noise and climate. tests and then. requiring strong mitigation measures, are some of the recommendations that we've tried to incorporate as we have done that, and then some of the further measures that are a bit more less Heathrow specific and more across.
aviation .
aviation .
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Scott Arthur
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Scott Arthur
Will will be addressed in the Jet Zero strategy review as as the minister referred to. So there's going to be an approval at some point. We expect as as we start down the pathway of looking at will the route. modernisation happen, how much SAF gets used? How successful are we on engineered removals? If it turns out that we aren't making the progress that we would like, is there a moment at which either the government pauses this even potentially after construction started, or restricts the amount of aviation that can come in and out of Heathrow if, in fact, it turns out that you're not on target .
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Steff Aquarone
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Steff Aquarone
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Steff Aquarone
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Steff Aquarone
Future reductions, not current reductions. Isn't it? True. But I feel like to an extent, I'm sort of dealing with the hypothetical of the hypothetical of like, if a decision is granted and then you have to deal with future changes that come after that decision has been taken. I think what we're trying to do is design a process by which, at the start, you can assure to the greatest extent possible that Heathrow expansion is compliant under the four tests, with carbon budgets and with our net zero obligations. That's exactly why we're doing this process. And the SCC and the EAC have given us very useful contributions about how we might think about that in an economy wide.
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Alex Mayer
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Alex Mayer
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Speaker 5
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Speaker 5
I think I may pass to Hannah on this one, if that's okay. Yeah of course. So just to come at the question in a slightly different way, if two if two applications come forward as as looks likely, each application would have to be assessed with their own merits assessed on their own compliance against the RPS and the requirements set out within the RPS. It wouldn't be a case of of kind of .
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Speaker 5
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Speaker 5
You you've managed to put in just now because it is so specific? So I guess the Heathrow expansion national policy, as you say, is a location specific national policy statement that is the same as the Airports National Policy Statement, which also applied to the northwest runway scheme at Heathrow, in terms of what we would expect to see at DCO application, that would be about how they intend to deliver that scheme, how any how any.
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Speaker 5
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Speaker 5
How they propose to meet the requirement. Don't think you've strayed into that area through the hems. No, I mean, I think the it is necessarily location specific because it is about nationally significant infrastructure. The the hub airport of which Heathrow is the one. It got to that point. We build on the work. The Airports National Policy Statement builds on the work of the Airports Commission. To get to that scheme, we had a process to get to check whether that was still the scheme that the MPs should rely on. The MPs does focus on that scheme, but in terms of the delivery of that, all of the detailed work around that, all of the.
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Speaker 2
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Speaker 2
The point at which or any promoter to demonstrate at the point at which they submit a DCO application. I guess what I'm getting at is, is it too specific in terms of it's remove the. flexibility for, you know, is it there's just too much specifics in it about how it should look and how it should be.
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Speaker 5
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Speaker 5
Should that not have been left to a later stage? I think I think there is within in terms of the specifics within the national policy statement, it talks about runway length up to a certain length. It talks about phasing. It talks about the ways in which it can be delivered. But I think it it does leave a lot of .
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Steff Aquarone
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Steff Aquarone
You disagree with them on that, then? Okay. If I might just add very briefly, chair, I think that the scheme specific nature of the draft MPs does mean that necessarily we need to have a conversation about how Heathrow Airport presently exists and how it might change in the future under expansion. I would say that of the potential promoters who have given evidence to this committee and said that they intend to submit a DCO application. I think what we're actually seeing is a lot of kind of productive conversations about how, whether it be through phasing conversations about runway length, comparative differences between schemes, we're seeing quite a healthy debate about how you might go about expansion in different ways.
So Heathrow has limited it's completely fair if they if they're raising concerns, and we'll certainly listen to them in the context of this consultation. But what I would say is they've been able to have quite a robust debate about what that should look like and how it would how you could do the scheme in different ways, with a phased approach within the existing envelope of the .
So Heathrow has limited it's completely fair if they if they're raising concerns, and we'll certainly listen to them in the context of this consultation. But what I would say is they've been able to have quite a robust debate about what that should look like and how it would how you could do the scheme in different ways, with a phased approach within the existing envelope of the .
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Steff Aquarone
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Steff Aquarone
What level of additional road traffic would be acceptable? Well, it is for a promoter to demonstrate how they're going to minimise the kind of landside airport related traffic that comes as a result of expansion. They'll have to work very closely with both national. highways and the other stakeholders with responsibility for the strategic road.
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Steff Aquarone
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Steff Aquarone
Particularly on questions around the M25, and they've got to make sure that their plans are feasible and deliverable. I will be honest and reflect on the fact that there is more work to be done on modelling and analysis, so that we can develop a fuller understanding of the implications of. expansion for the road network. I think that means in the context that we have, asking an applicant to set out how they will minimise and manage additional traffic created is the right sort of lens, while we get a fuller .
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Daniel Francis
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Daniel Francis
Specifics of the scheme that they would put forward. Two aspects. Firstly, TfL say even if you achieved your modal shifts, there would be 60,000 extra road traffic movements per day. And equally from Heathrow, we hear aspirations about huge numbers of extra car parking space on the site. So, so . So how do those how does .
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Steff Aquarone
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Steff Aquarone
That mirror of the aspirations you've just set out, Minister? Yeah, it's a fair question. And we would expect any promoter to set out a plan for how they intend to increase car parking at the airport, given the fact that we've got stretching public sector mode share targets, but people still will travel to Heathrow Airport by car. And I think we had a conversation, the civil aviation bill yesterday, didn't we, about how particular communities, particularly in rural.
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Steff Aquarone
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Steff Aquarone
May use a car to more readily access an airport than others. But it remains the case that any promoter would have to demonstrate that the significant impacts that might happen through. congestion on capacity, on highway safety have to be. mitigated to an acceptable degree. So in that context, we think that we're in a reasonable place in terms of them having to set out stretching targets, and they intersect very closely with those public sector mode share targets. So it's in the interests of a potential promoter to think about how it can take capacity off the road and put it on to put it onto public transport.
And that's in the context also of what the Secretary of State said about it being a central .
And that's in the context also of what the Secretary of State said about it being a central .
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Daniel Francis
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Daniel Francis
Traffic impacts are mitigated as part of any potential scheme. But Gatwick and Luton, I'll come back to public transport in a moment, but Gatwick and Luton future airport growth has been linked into the objectives. The surface of the modal objectives. So do you. envisage that would form part of the DCO in due course that those objectives .
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Speaker 3
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Speaker 3
In there for for how that would be achieved at Heathrow, that was decided at DCO stage rather than the stage we're at now. We can't prejudge that, but I would say it does set an example of how these things can be secured and done so without saying specifically. That is what what would happen on this one? There is a .
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Daniel Francis
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Daniel Francis
Precedent and an example there for how you can can mitigate control these measures. And lastly, on public transport, you know, I've already referred to Heathrow looking at those additional car parking spaces. But equally, what we've really what I've really struggled, I think the committee's really struggled with through this process is we've talked a lot about an additional link rail link to the south and to the west. We've struggled to understand, particularly in last week's evidence, who may fund that, because, you know, even the airport itself is saying, well, we won't be funding it and the taxpayer won't be funding it.
So how do you envisage that may play out in due course, that if we do need those additional links, that who would be funding that .
So how do you envisage that may play out in due course, that if we do need those additional links, that who would be funding that .
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Steff Aquarone
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Steff Aquarone
To to make sure that we can get those additional public transport links? Yeah. Well, any new surface access schemes, whether that be rail schemes from a variety of. destinations into the airport, the. responsibility for financing them rests with the promoter of the scheme. I know that you've taken evidence as part of this committee about whether you might have third party private provision on some schemes, and I think that that's a matter to be best explored through that process. But while it's, of course, the case that any potential promoter and development, financing and implementation of the schemes would likely work closely with organisations like.
TfL and like GBR.
TfL and like GBR.
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Speaker 1
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Speaker 1
Which says surface access. costs where they're efficiently incurred could be passed on to. consumers where that's commensurate with the. benefits to consumers. We are we'll be. consulting on, in the current context about whether any changes to that policy are appropriate. But but in the existing policy, and I would expect going forward, we will also that policy will need to take into account any requirements that are set through the planning process. But I think, as the Minister said, incumbent on promoters to come forward with plans, work with TfL and say what is what is required. But as as with all sort of costs associated with.
expansion that parties would wish to pass on to.
expansion that parties would wish to pass on to.
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Alex Mayer
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Alex Mayer
Going to be really important that they are. justified and efficiently incurred. It wouldn't be TfL if for the for the new railway lines that are needed because they're from the the West and the south or South west and the airport, the promoters have accepted that they would be. responsible for some of the.
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Alex Mayer
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Alex Mayer
Although we have it on record that they would be prepared to pay a proportion. But if the public sector, the taxpayer, is not going to pay for the rest and there is no other credible. Scheme on the table, I know there are. promoters of schemes, but is there a credible. I've not seen a credible proposal on the table, and yet it is deemed. essential if, as a Secretary of State says, the M4 and the M25 aren't grand, aren't to .
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Steff Aquarone
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Steff Aquarone
Prepared to pay. 100% of the of the cost of the new rail infrastructure? Well, I think the question of how those new schemes, first of all, those schemes can't be laid out in a prescriptive way through the MPs at present. And that's because of phasing over time. You need different passenger demands from different parts of the country. Over time, we've set out that those schemes have to be privately.
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Speaker 3
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Speaker 3
As is the case at Gatwick and Luton. Yeah. I imagine to have confidence that they could be delivered. You would use conditions in some way to to secure that. So we've asked for a surface access strategy, which includes a credible plan for how these rail schemes will come forward. And we're not saying that those rail schemes will have to be consented through that DCO process. You would want to be, you know, to pass the credible.
What we've put in the in the MPs. For that, you would need to see a detailed plan for .
What we've put in the in the MPs. For that, you would need to see a detailed plan for .
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Alex Mayer
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Alex Mayer
Be coming forward, who would be delivering it when that's likely to be expected. You're confident that some that the construction and some growth could occur without the new rail lines, without the. M25 and the M4 grinding to a halt. Have you had figures? Are there figures on the. impact from now on towards growth,
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Steff Aquarone
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Steff Aquarone
We have to be cognizant of the fact that phase delivery of airport expansion and the concurrent impacts in the number of passengers travelling to the airport will. require different rail schemes from different parts of the country to the airport, which are delivered at different times. Therefore, I don't think it's wise to be too prescriptive in saying X or Y scheme must be delivered through the MPs. I think it's better to have a top level way of linking what the targets are in terms of public.
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Steff Aquarone
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Steff Aquarone
Government not see it as necessary to include it within these documents? I suppose this returns to quite a fundamental question about how this process is designed, which also came out of the multi promoter question. And it's about whether being more. prescriptive leads to more. specificity in the meeting of targets. And you lay out exactly where you're going to go over time, or whether more. flexibility allows a for more kind of. diversity of approach in how a potential promoter might bring schemes forward and greater flex about how you might do it over time, given the fact that this is a major infrastructure project which will unfold and therefore have implications on things like carbon budgets over a.
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Jacob Collier
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Jacob Collier
Promoter question as well. Thank you. Yeah. And just to to the CIA, surface access policy currently prevents Heathrow from fully funding any rail schemes that have beneficiaries beyond airport users. But of course, if there was to be Southern or Western access, then it would obviously benefit others. So given what the minister said about the fact that these schemes have to be privately financed and there's not going to be any taxpayer support, who ultimately is going to pay, and is this .
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Speaker 2
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Speaker 2
Going to be sorted out before a DCO process? We've got an established policy. We're going to consult on potential changes to that. As I said, I think the policy will need to kind of take account any sort of requirements set during the planning planning process or sort of start point is our statutory duties and thinking about the interests of interests of consumers. But we.
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Speaker 1
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Speaker 1
Actually fail these tests and how you propose to respond to that feedback. Yeah, certainly take that feedback on board. And if there are concerns about compliance with either of the tests in regard to it not being sufficiently tangible, I'd be very, very glad to hear it. I suppose just to take them both in turn with the air quality test of not. producing air quality impacts that result in new breaches or make existing breaches materially worse, have legal obligations on air quality. I think that's a pretty tangible and firm and measurable basis upon which you would measure compliance with that test.
Quite similarly with noise. It's compared to a. 2024 baseline, which is measurable. Yeah.
Quite similarly with noise. It's compared to a. 2024 baseline, which is measurable. Yeah.
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Speaker 4
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Speaker 4
A s s. So some sort of scheme that would compensate pay out. I think the. detailed monitoring, enforcement and compliance is something that does need to be worked through. So at this stage we're setting out, we would want to see modelling and projections that you can meet that test over the life of the scheme, and hopefully that gives you confidence that it's passed the test. But then in order to provide confidence and trust in that process, you would need then to set out as part of the DCO how that will be monitored, tracked over time, and in the event .
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Steff Aquarone
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Steff Aquarone
That it breached because the modelling was wrong, you would need corrective action. That's very helpful because we can't predict the future. So this all becomes a little bit meaningless if there's no real enforcement or consequence. I mean, I guess the other thing I don't I do want to get back to CNI. I'm sorry, I don't want to drag us back there, but I want to purposefully and productively take us back there. I mean, how would you answer the charge that as long as the mitigation hierarchy .
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Speaker 4
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Speaker 4
Ever outweigh the need for this. classification mitigation. So it's residual influence after you've done everything to mitigate, compensate, reduce. That all still applies in terms of a hierarchy. And then in the event there are still residual impacts, you know, additional traffic, anything that it could be, it's then that you're weighing up. Does that strategic national need outweigh what is .
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Steff Aquarone
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Steff Aquarone
Left at the end after you've done all of that hierarchy of interventions? Okay. I suppose I don't repeat your own words back to you, but, you know, possibility of fulfilling in some more information, some clarity might be worth seizing here. And just, just to reinforce that on your answer to, I mean, where this sits, whether it's in DCO conditions or in the hemps itself, I mean, I think both promoters and communities would be reassured to have expectations more clearly signposted.
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Speaker 5
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Speaker 5
You Scott. Thanks. It seems likely that over the next decade, we're going to improve our air quality standards, move them closer to the Who guidelines. The so so I guess in as part of this process, we can assess the airport plans against the existing quite dated. legislation we have. Or we could choose to think about how that is going to improve over the coming years. Do you think it is right to go for that legal minimum, rather than .
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Speaker 1
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Speaker 1
Move towards something which we know is going to protect health much more? It's an interesting debate. I think the reason why the test has been set as it is, is that it gives us a criteria to work off, which gives you an ability to form a clear and objective assessment about whether the test is likely to to be met in a way which is established, which has legal precedent, which is. measurable and which is. ultimately enforceable. The purpose of the test is, of course, to achieve the objective which you set out, which is to protect public health over time.
But we need to do that in a in a way that we can, to the greatest extent possible,
But we need to do that in a in a way that we can, to the greatest extent possible,
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Speaker 5
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Speaker 5
Ensure compliance can be linked to, if that makes sense. Yeah, it's dated in terms of public health, I think the sector states has said, well, the Hemp's apology said they say that it is acceptable for some of the. improvements in air quality around Heathrow to be unwound for air quality to get worse.
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Speaker 4
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Speaker 4
That's not acceptable, is it? I think the wording is it's saying that whilst a worsening air quality is not on its own, a reason to refuse development consent at that stage, you still need to pass the test and show that you have one, reduced it as far as possible and two not resulted in any new or make existing breaches worse. So I think it's acknowledging that it's not saying no change .
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Speaker 5
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Speaker 5
Has been updated to reflect current standards and air quality rather than be around the ultrafine particles. I mean, there's still a lot of uncertainty about the health impacts of these. Do you think these these are adequately assessed within the process or you look and you're hoping and looking for more .
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Alex Mayer
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Alex Mayer
I would expect them to do that as part of the process. Yes. Thank you. Sure. Okay. Thank you. And on noise, the draft hemp's requires significant adverse impacts from noise on health and quality of life to be. avoided by limiting or. reducing overall aircraft noise. But that kind of throws under the bus those tens of. thousands of. people who don't currently live. underneath the. immediate landing or take off paths and will be. under runway three. And you using. 2024 as an acceptable baseline , despite the fact you've seen the anus and anus, and an study suggesting that people are more annoyed than was.
originally understood by. aviation noise and at lower levels.
originally understood by. aviation noise and at lower levels.
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Speaker 1
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Speaker 1
So why was that? Why was 2024 an acceptable baseline? Well, I think 2024 was chosen as the baseline year because it was the kind of most recent data that's available at the time, and it's considered to be a reasonable but challenging baseline year. And that's given expected technological. improvements that will come down the track. It's also worth saying that the Anderson, Annie, Annie, Annie, Annie studies were considered as part of the draft MPs, with modelling.
undertaken at these levels as a sensitivity test. So we are trying to factor that work into noise.
undertaken at these levels as a sensitivity test. So we are trying to factor that work into noise.
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Speaker 6
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Speaker 6
Airport you live close to. So I think the answer for that is that in the Gatwick case, the threshold was developed through the DCO process and it reflects the sort of circumstances of of that project. Mitigation measures are decided on on a case by case basis. So we have. proposed a threshold. There will then be for the applicant to come forward with their proposals of how they would .
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Alex Mayer
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Alex Mayer
About the. inordinately slow rollout of noise insulation. Tens of thousands of people are eligible for it. Only less than 200 have actually got the noise insulation. Works that they're entitled to under previous expansions that Heathrow. So given how slow the process is, partly through Heathrow's own foot dragging and partly through CAA rules on what the airport can and can't spend on on.
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Speaker 1
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Speaker 1
Be enforced and delivered, given it's not being enforced and delivered at the moment? Well, I'll turn to Tim in a moment, but I believe it's through the. 2018 MPs that it was required to pay. £3,000 for for noise compensation. And I think just to sort of take my MPs hat off for a moment, I do think if London , West London MPs have got concerns about the speed at which that is being rolled out, that's a very live concern for me. And when I was at when I went to Heathrow Airport and I met with those community groups, that is something that they consistently raise about how we learn to live with noise.
But actually, it's a lifelong impact on your ability to live a happy and fulfilled life. So I can certainly take that away. What I would say is, in terms of the draft MPs and how it encourages a potential promoter to go further in terms of community compensation.
But actually, it's a lifelong impact on your ability to live a happy and fulfilled life. So I can certainly take that away. What I would say is, in terms of the draft MPs and how it encourages a potential promoter to go further in terms of community compensation.
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Speaker 1
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Speaker 1
Statutory blight. The Secretary the Secretary of State expects that compensation. requirements go much further and that you have a comprehensive package of support for affected communities. If the committee's view and the view of respondents is that the existing level which has been carried over for the . For Rhys, in a sense, to have that conversation from the previous MPs doesn't go far enough. I would be very glad to hear it, because we want to make sure that it's not just a potential promoter meeting the bare minimum, but going a lot further both, and I think that would be interesting.
Obviously predetermined the committee's work to look at through two lenses, one through the question of the actual. amount and secondly, through the the speed and the .
Obviously predetermined the committee's work to look at through two lenses, one through the question of the actual. amount and secondly, through the the speed and the .
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Alex Mayer
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Alex Mayer
Expectation by which rollout might occur of any potential mitigation and compensation scheme. I think I think normal people would, who aren't immediately affected would assume that the mitigation would be in place before the the flights started rolling in. And yet we've had terminal five with us for 25 years, and we're not even now seeing the. conditions that were. imposed as part as part of that terminal terminal that as part of that planning.
application and to. Tim. So Heathrow Airport Limited tell me that they're. constrained in meeting their current. requirements for noise.
application and to. Tim. So Heathrow Airport Limited tell me that they're. constrained in meeting their current. requirements for noise.
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Alex Mayer
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Alex Mayer
The free bus travel, other. sustainability and. environmental delivery around the airport. They tell me that they're. constrained by CAA rules about what they can and can't spend money on. So how would you ensure that the future regulatory model won't. compromise deliberate. delivery of the commitments and. mitigations that the local. community has been led to. expect from and is being told? Will we .
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Speaker 2
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Speaker 2
All be fine under any expansion? We understand this is really important issue for for local communities. Through our price control process, we set an envelope for Heathrow. It's absolutely a matter for them to make sure they make these schemes available within that envelope. But we will we will also. challenge Heathrow on what they propose to spend. I think you'll be aware in the current two way configuration, they spend roughly £10 million a year. That's the allocation. They proposed an increase, five fold increase in that. And in their initial application, we didn't feel they'd sufficiently justified that.
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Alex Mayer
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Alex Mayer
Now we've not made final decisions on that. We recognise it's important. Part of the noise insulation spend is going to be cut in the next period, because Heathrow didn't spend up to their required amount under the previous period. So it seems that, you know, there the noise insulation you're it sounds like you're going to be responsible .
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Speaker 2
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Speaker 2
For even less money being spent on noise insulation than in the last period. We're not reducing the amount of £10 million a year. Is their current budget allocation for it. They have proposed a five fold increase to. £50 million a year. We're in the process of reviewing that. Their initial justification wasn't clear. We've got final decisions coming that up on that in the next couple of months, but we do recognize it's an important issue, and we would expect to hold Heathrow to account to make sure that .
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Alex Mayer
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Alex Mayer
But our community organisations and the local. authorities find it really, really. difficult to get any sense of anybody being. interested in enforcing the. conditions that are there. Are you proposing anything. different or more or more beefed up as part of the any decision on on a third runway to to so that so that affected. communities actually will get .
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Speaker 1
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Speaker 1
Something very briefly, chair? Yeah, sorry. Only that when I went to Heathrow Airport as part of the consultation. process and met with the leadership at Hillingdon Council, but also met with local community groups, I think there are a whole range of ancillary issues which have been. created by the operation of Heathrow Airport, which we all acknowledge is absolutely critical to UK air. connectivity and provides thousands of good local jobs and everything else. But there are negative externalities which have occurred as a result of it that go beyond noise and go beyond air pollution. And you think about sort of issues to do with community.
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Alex Mayer
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Alex Mayer
Know about until six months ago. If there's space to go further, we must go further, a lot further. So can I just talk about the fixing figures for community compensation? Because I know in the Gatwick DCO there's an amount per home. Our predecessor committee recommended against fixing figures for any kind of. compensation because, you know, they need to be assessed, subject to need, particularly for noise.
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Speaker 1
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Speaker 1
It's worth saying that any compensation package would have to receive scrutiny as part of a planning proposal, and therefore there is. There is space for analysis of different options there in terms of whether you want to be prescriptive with a particular figure. I'm happy to consider that as part .
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Speaker 2
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Speaker 2
Authorities, the local communities think the money should be spent. Ultimately, Heathrow has to put the put forward the the plan. They can use a range of evidence, as we've seen in Gatwick. I would imagine out of the DCO process, there may be some requirements around this, and I would expect Heathrow to factor those into their case and, say, the DCO. process or indeed any other promoter that gets the DCO would need to say, look, here's the planning condition. This is what it requires us to do. This is how we're going to deliver that outcome efficiently.
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Speaker 2
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Speaker 2
Efficient, it won't go ahead. That's the challenge. I guess that's we we say we understand that you need to deliver an outcome that has been specified. And the question is how do you do so efficiently? So it would not be for us to say there's a planning condition if indeed there is one or other requirement, legal.
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Speaker 6
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Speaker 6
Calculation that has lent to the NPV? I think there's those externalities would be taken into are taken into account in the NPV as calculated in the here and in the in the kind of supporting work the the full. The full detail of that is set out in the in the economic appraisal report, I think, as Tim says, just to sort of delineate the process, the the here sets out the NPV of the, the of, of doing the thing of the kind of case for expansion and expansion as a whole. In the course of submitting the application, they would set out the things that they would do, including in relation to noise, including in relation to those things.
Once those are.
Once those are.
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Alex Mayer
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Alex Mayer
Its teeth. Well, yeah, exactly. So I'll happily take that away and think about how we can do better. Alex has been trying to get in. Thank you Minister. Thank you. The this committee has heard. evidence that the Longford. Conservation Area will be demolished if expansion goes ahead. And also the case of a vibrating barn. Does Hempz provide any additional protection in terms of dealing with risk to heritage beyond what exists .
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Speaker 1
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Speaker 1
And the committee's. recommendations very, very. closely before we set out what our response is and our next steps. Can I just reconfirm, though, to the committee that any amended would be published late in Parliament and subject to a vote prior to having legal effect? But as I say, we're at this stage in the process, we're going to carefully .
11:47
Alex Mayer
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Alex Mayer
Consider the responses and then set out our next steps in due course. Okay. Thank you. Thank you very much to all of you for your evidence and the time you spent. preparing for today. And if there's anything you didn't get a chance to cover or to cover adequately, please do feel free to write to us. You did make a couple of. references in your in your submissions.
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