Britain's May defies critics to back new $22 billion Heathrow runway

October 25, 2016 6:45 AM EDT

An aircraft comes in to land at Heathrow airport in west London, Britain October 25, 2016. REUTERS/Eddie Keogh


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By Kylie MacLellan and Sarah Young

LONDON (Reuters) - Britain backed a $22 billion expansion of London's Heathrow Airport on Tuesday, ending 25 years of indecision with an ambitious plan to boost global trade links following the vote to leave the European Union.

Heathrow, Europe's busiest airport, defeated a proposal from smaller rival Gatwick to secure the first new full-length runway to be built near London in 70 years after environmental and political protests scuppered previous attempts.

The long-awaited decision put Prime Minister Theresa May on a collision course with several senior politicians including her own foreign secretary, Boris Johnson, and the plan is also likely to be challenged in the courts.

But with a promise of jobs and greater trade links after Britons opted in June for Brexit, May is likely to win parliament's approval, triumphing over an issue that has paralyzed successive governments in the past.

"After decades of delay we are showing that we will take the big decisions when they're the right decisions for Britain," May said of her Conservative government's backing for what will one of Europe's biggest infrastructure projects.

The decision in favor of a third runway at Heathrow, due to be built by 2025, is one of May's most significant acts since she took office in July. It follows her approval in September of a $24 billion nuclear power plant at Hinkley Point.

With established links around the world, Heathrow always offered the greatest economic potential. However, its position to the west of London, near several affluent suburbs represented in parliament by Conservative lawmakers including Johnson, drew a powerful coalition of opponents worried about noise and pollution.

A new runway will also require parts of the motorway circling the capital to be rebuilt, making it more expensive and complex than alternative options to extend an existing Heathrow runway or build a new one at Gatwick, south of London.

According to a three-year study by Britain's independent Airports Commission, a new runway at Heathrow would create 70,000 new jobs by 2050 and increase gross domestic product by between 0.65 and 0.75 percent over the same period.

It will also enable Britain to keep pace with Europe's biggest airports in Paris, Amsterdam and Frankfurt, which have greater capacity.

FACTBOX - Reaction to Heathrow runway decision

FACTBOX - What next after expansion backed?

CITY OF PLANES

But within hours of the decision, politicians were lining up to denounce it. Johnson, a leading Brexit campaigner, said the plan was "undeliverable" and "very likely to be stopped" while London Mayor Sadiq Khan, alarmed by the potential impact on air quality, said he was exploring legal options.

Zac Goldsmith, a lawmaker in May's Conservative Party, resigned over the issue, meaning a by-election will be held in his constituency near the airport and May's already slim majority in parliament will be reduced.

Johnson, a former London mayor who once vowed to lie down in front of the bulldozers to prevent a new Heathrow runway being built, said he worried that a third would be followed by a fourth.

"You'd have New York, a city of beautiful skyscrapers, Paris the city of light, London the city of planes," he told reporters. "Is that really what we want for our fantastic capital city?"

Wary of being damaged by the issue, May has allowed her ministers to criticize the plan but not campaign against it before a vote in parliament in a year's time. Surveys show a majority of lawmakers will back her.

Lawyers said opponents could delay the decision on the 18-billion-pound project in the courts but were unlikely to be able to block it.

Adam Marshall, director general of the British Chambers of Commerce, said governments had prevaricated for too long.

"Put simply, it's about time," he said. "Businesses will now want assurances that the final approval process for Heathrow's new runway will be smooth and swift, so that construction can begin as soon as possible.

"The time for playing politics with our national connectivity is over."

Heathrow is owned by Spanish infrastructure company Ferrovial, Qatar Holding, China Investment Corp [CIC.UL] and other investors, and the bill for expansion will be paid for by the private sector, with the government expected to pay for some of the additional road and rail costs.

Engineering firms Arup, U.S.-headquartered CH2M, British construction company MACE and construction and project management firm Turner & Townsend are already working on the early stages of the project.

The government said the UK aviation regulator would work with Heathrow and airlines to ensure the new runway was affordable and keep landing charges paid by the carriers close to current levels.

The government also proposed legally binding noise targets to provide respite for local residents while Heathrow will need to meet air quality rules as a condition of planning approval.

"Heathrow stands ready to work with government, businesses, airlines and our local communities to deliver an airport that is fair, affordable and secures the benefits of expansion for the whole of the UK," the airport said.

(Additional reporting by William James, Paul Sandle, Costas Pitas and Estelle Shirbon, writing by Kate Holton; Editing by Giles Elgood and David Stamp)



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