Economists Raise Concerns Over Heathrow Airport Expansion Plans

Strategic Insights -

A group of 29 economists, including 16 professors of economics at top UK universities, have written to Chancellor Rachel Reeves and Transport Secretary Heidi Alexander to express their concerns about the government's airport expansion plans. The economists, from the UK, US, and Australian universities, argue that the benefits of expanding Heathrow Airport are "at best uncertain" and that there are no indications that the environmental and health impacts of airport expansion can be adequately mitigated. The government has committed to reviewing the Airports National Policy Statement, which sets out the decision-making criteria for a third runway at Heathrow.

Key Takeaways:

  • 29 economists, including 16 professors of economics at top UK universities, have written to the government to express their concerns about the airport expansion plans.
  • The benefits of expanding Heathrow Airport are "at best uncertain" according to the economists.
  • The letter notes that business flights are down 20% compared to pre-Covid levels and are "not expected to return any time soon".
  • The economists suggest that the government should consider lower-impact alternatives to expansion, such as better utilisation of capacity in the Channel Tunnel, incentivising airlines to prioritise higher-productivity routes, and encouraging businesses to transport goods by rail and sea.
  • Dr Alex Chapman, senior economist at the New Economics Foundation, notes that comprehensive recent assessments of airport expansion recommended refusal because the balance of benefits and costs did not stack up.

Statistics:

  • 20%: decline in business flights compared to pre-Covid levels.
  • £49 billion: the investment plan submitted by Heathrow Airport.
  • £21 billion: the proposal for a third runway and airfield infrastructure.
  • 756,000: additional flights capacity proposed by Heathrow.
  • 150 million: additional passengers capacity proposed by Heathrow.
  • £12 billion: the estimated cost of a new terminal T5X.
  • £15 billion: the estimated cost to upgrade existing facilities.

Sources:

  • [Source: letter from 29 economists to Chancellor Rachel Reeves and Transport Secretary Heidi Alexander]
  • [Source: Heathrow Airport's £49 billion investment plan]