Heathrow Airport: Public Consultation

Stephen Pound Excerpts

Wednesday 24th January 2018 Westminster Hall

[Sir Vince Cable]

The hon. Gentleman is absolutely right. I want to dwell a little on that £18 billion figure which, as he says, is based on rather conservative assumptions. Where that will come from is one of the big unanswered questions. The Government say that they will not provide financial support. The airport itself has come up with £1 billion towards the £18 billion, but it is already a highly leveraged company. Questions have been raised about its balance sheet, and particularly about the large-scale tax-avoidance schemes that have enabled it to finance its debt so far, so how will it raise yet more to fund the infrastructure? The only way that could happen is if the airport very substantially increased landing charges. One of the reasons why major airlines such as British Airways have turned against Heathrow expansion is that they realise that that would be a necessary consequence. The other potential source of funding is TfL, but it is highly constrained by public sector borrowing restrictions and the need to fund Crossrail, which will be a major burden on its balance sheet in coming years.

TfL has spelled out in detail how the public transport infrastructure would have to be provided, and much of it is highly problematic. It would have to go a lot further than some improvements to the Piccadilly line and the Elizabeth line. It would involve, among other things, improving southern rail access. However, as the hon. Member for Richmond Park (Zac Goldsmith) well knows, that is problematic. The southern rail route runs through my constituency and his. If the route to Heathrow ran through his constituency, there would be serious problems with prolonged closures of level crossings, and the line through Kingston and Wimbledon is already congested. It is not at all obvious how that improvement is feasible— it has not even been sketched out—and there is a big question for the Government about how it would be funded.

The other question that the revised consultation raises is about increased passenger numbers. It is important to stress that the revised figures—the Government’s own numbers, not anyone else’s—suggest that the national economic benefit of airport expansion would be significantly greater at Gatwick than at Heathrow. That is a reversal of the Airports Commission’s analysis. Do the Government accept that conclusion? If they do not, perhaps they will explain why not. If they do, how do they propose to respond? They could say, “Well, we don’t care, because we’re not really interested in national economic benefit. We’ve decided we’re going to have a hub airport.” However, that would raise two big questions: why proceed with a national hub airport if it is less economically beneficial than the alternative, and why not ask or expect Gatwick to provide its own hub facilities, which it is perfectly keen and anxious to do?

The other factual information that has emerged from the new passenger numbers is that Heathrow airport will fill up very quickly. On current assumptions, it will start in 2026 and be full by 2028. That has knock-on consequences. There will be very little resilience, the airport’s authorities will be tempted to switch from domestic routes to more profitable international routes and it will make it much easier, given the monopolistic position, to push up fares even further.

Then there are the consequences of the higher passenger numbers, which are new. There is the impact on noise, which I think is of concern to all the constituencies whose MPs are in the Chamber. The original assurance given by the Secretary of State was that, when Heathrow was expanded, no more people in London or the areas around it would be affected by noise. The current numbers suggest that an additional 90,000 will be. Again, do the Government accept that?

What is important is not simply the aggregate numbers, but how that very large number of individuals—we are now talking about 1 million people—are directly affected. That relates to take-off and landing routes and the trajectory of the aircraft. At the moment, we have no information on flight paths, which is crucial to making an informed decision on how the project will affect our constituencies.

My final point on the data is that, although connectivity is one of the major reasons why Heathrow expansion is being considered, the new data suggests that connectivity to other British cities will decline with Heathrow expansion, from eight major destinations at present to five, and will be smaller than were Gatwick to proceed. I ask the Minister to consider how the Government regard this new evidence, which casts doubt on the feasibility of the proposal.

I will round up by raising the more basic question of how the Government are approaching consultation. Have they come to a conclusion, in which case we are going through a ritual, or are they meaningfully engaging in dialogue, listening to evidence and seeing it as a genuinely iterative process? One important step is how we are to see the consultation that Heathrow airport itself is now engaging in. It is important for our constituents to understand that what Heathrow airport is proposing seems substantially different from what the Government are proposing.

One of the options the airport is looking at is moving and substantially shortening the runway. I understand why it would want to do so, because that avoids all the horrendous problems of tearing up the M25 and rebuilding it under a tunnel, with all the costs involved. If it is changed in that way, that substantially affects the noise contour; I think there are 20,000 people who would face much more intense and intolerable noise levels, many of them in the constituency of the shadow Chancellor. There is a question how that would be dealt with.

[Stephen Pound (Ealing North) (Lab)]

I am very grateful to the right hon. Gentleman. This is a timely debate. I have to confess that I have not received the same volume of consultative literature in the north of the borough of Ealing as he has, for various reasons. I wonder whether, among the data of the passenger and transport movements to and from the airport, there has been a disaggregation that identifies the cargo and freight movements—specifically because the economy of Northern Ireland is almost entirely dependent on cargo freight movements into Heathrow airport. I appreciate that the right hon. Gentleman is talking about passenger movements, but is there a disaggregation that identifies cargo movements to and from Heathrow?

[Sir Vince Cable]

I cannot answer the hon. Gentleman’s question, but I hope the Minister will be able to. There is a specific issue about freight, not just in the air, but on the ground. One of the contributing factors to a lot of the worries about air quality relates to freight on the ground, which is linked to air journeys.

I have one minute left for my presentation, so I will conclude by trying to probe further how the Government see this consultation. The Secretary of State said in July that the Heathrow expansion project, along the lines that were originally identified, would definitely go ahead. We are left with the question of whether that is inevitable if the evidence changes? We now have evidence based on the Government’s own numbers to suggest that Gatwick is a more economically attractive alternative. Does that matter? How much more attractive does it have to be before the Government might consider the fundamentals around the location? If the air quality evidence is so damaging, at what point do the Government reconsider their options?

Fundamentally, going back to the intervention by the hon. Member for Richmond Park, we are potentially talking about large Government subsidy if the airport is to avoid a very large increase in landing charges or funding from sources that we cannot yet identify. Is there a level of subsidy and Government funding that is unacceptable? We have new evidence, which is emerging all the time and is becoming progressively less favourable to the case for Heathrow, so I will leave this question with the Minister: how open-minded are the Government to that new evidence, and how will they progress the project?