Airport Capacity - Statement

– in the House of Lords at 4:24 pm on 25th October 2016.

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Photo of Lord Ahmad of Wimbledon Lord Ahmad of Wimbledon Parliamentary Under-Secretary (Department for Transport) 4:24 pm, 25th October 2016

My Lords, with the leave of the House, I will repeat a Statement made by my right honourable friend the Secretary of State for Transport in another place. The Statement is as follows:

“Last year, the independent Airports Commission delivered its final report under the chairmanship of Sir Howard Davies. I would like to pay tribute to the quality and professionalism of its work and express my thanks to all members of the commission. The report concluded that we needed more capacity in the south-east and put forward three viable options for expansion. It unanimously agreed that the proposed north-west runway at Heathrow presented the strongest case.

In December, my predecessor came to the House to announce that the Government accepted the commission’s assessment of the need for additional capacity, but made it clear that further work was required before making a decision on the location of a new runway. That work is now complete.

Mr Speaker, this is a momentous step for our country. The decisions taken earlier today, which I shall outline in a moment, are long overdue but will serve our country for generations to come. I know that some Members of the House have strong convictions on this issue, and everyone in the House will fully understand the significance of this announcement: the significance for jobs, for an economy which works for everyone, for passengers, for the global importance of our country, for the environment and for people affected by expansion—and also to send a clear message that Britain is open for business.

It is not an easy issue or a simple process. I make no apologies that we have taken time to get it right, but today shows that this is a Government unafraid to take difficult decisions and get on with the job.

Before I outline the decision the Government have reached, I want to explain how today’s announcement fits within the planning process, and the opportunities that Members of this House will have to contribute. In the new year, we will bring forward a draft national policy statement, which will include details of the proposed scheme. As required under legislation, this will be subject to a full and extensive public consultation, followed by a period of parliamentary scrutiny. Only once members have voted on the final national policy statement, and it has been designated, will the airport be able to bring forward a detailed planning application.

Strong connections with global partners and the ability to trade with new and growing markets are vital to securing Britain’s place in the world. The United Kingdom currently has the third-largest aviation network in the world, behind only the United States and China and contributing over £22 billion to UK GDP. We have the second-largest aerospace manufacturing sector, which generates annual exports of £26 billion. Our aviation industry supports almost 1 million jobs and invests £1.7 billion every year in research and development. Last year, UK airports handled more than 250 million passengers—up 5.5% on 2014—and 2.3 million tonnes of freight. Heathrow is the busiest two-runway airport in the world and Gatwick the busiest single-runway airport. Indeed, the London system will be almost entirely full by 2030, with the exception of a small amount of capacity at Luton—and that will be taken up soon afterwards.

If we do nothing, the cost to our nation will be significant, amounting to more than £20 billion over 60 years through delays, fewer flights and passengers having to fly from airports elsewhere. In addition, the wider impacts on our economy will be in the region of £30 billion to £45 billion. That is why the decision we have reached today is so important to the future of our country—not just to tackle the immediate shortage of airport capacity but to set our country on a course to even greater prosperity for future generations.

I have spent a considerable amount of time this summer visiting the different schemes, talking to their promoters and assessing their strengths and weaknesses. I have been genuinely impressed by the quality of choice available to us and the detailed work that has been put into the three plans. Any one of them would bring benefits to our country. At the end of its work, the Airports Commission made a clear and unanimous recommendation to the Government: that we should accept the proposal to build a new north-west runway at Heathrow, subject to a package of measures to make expansion more acceptable to the airport’s local community.

Since the publication of that recommendation, my department has studied in detail both its report and new and supplementary information that has emerged about the different options since then. The commission’s report and that subsequent information formed the basis of the discussion that took place this morning at the Cabinet sub-committee.

As a result of that discussion, the Government have decided to accept the recommendation. We believe that the expansion of Heathrow Airport and the north-west runway scheme, in combination with a significant package of supporting measures on a scale recommended by the Airports Commission, offers the greatest level of benefit to passengers and business, and will help us deliver the broadest possible benefit to the whole of the United Kingdom. It will deliver the greatest economic and strategic benefits to our economy; it will strengthen connectivity for passengers right across the United Kingdom; it will offer a major boost to freight operators; it can be delivered within carbon and air-quality limits; and, crucially, it will come with world-leading measures to limit the impacts on those living nearby.

In addition to the benefits identified by the commission, this scheme will deliver the connectivity and hub capacity the United Kingdom needs to compete with fast-growing European and Middle Eastern hubs. The airport’s location means that it is more accessible to business and the rest of the UK by both road and rail. Access to Heathrow is more resilient and it is better placed as the national freight hub. Ultimately, it brings the largest benefits to passengers and the wider economy of up to £61 billion over 60 years. But we are not alone in this view: UK airlines and business are also clear that Heathrow is the right place to expand.

Before continuing, I pay tribute to the promoters of the other two schemes considered by the sub-committee. Both presented well-developed and compelling cases for new capacity. In particular, I would like to place on record that Gatwick, despite not being selected today, remains a key part of our national transport picture and will continue to do so in future.

I want to be very clear: expansion will not be at any cost to local people, to passengers or to industry. We must make three assurances: first, to make Heathrow a better neighbour. We must tackle air quality and noise, and meet our obligations on carbon both during and after construction.

Air quality is a significant national health issue which the Government take very seriously. That is why we undertook further work which confirms the commission’s original conclusion on air quality that a new runway at Heathrow is deliverable within air-quality limits, and we remain committed to ensuring this remains the case. The airport has already committed to industry-leading measures to mitigate air quality impacts. Furthermore, the Government will grant development consent only if we remain satisfied that a new runway will not impact on the UK’s compliance with its air-quality obligations.

The broader issue of air quality is one that the Government take very seriously indeed, and the updated evidence base shows very clearly that the biggest challenge we face is not the expansion of an airport but the level of emissions in built-up urban areas more generally. This is the very reason for our national air-quality plan.

I can also tell the House that, as part of my ongoing work on air quality, my department, along with Defra and the Treasury, has embarked on a joint project to identify further ways in which we can tackle this issue. By the time a new runway opens in the next decade, we intend to have made very substantial progress in tackling these air-quality challenges across our nation as a whole.

On the issue of noise, I say that no airport can be silent. Technology, though, is making aircraft quieter. The newer-generation aircraft coming into service have a noise footprint typically 50% smaller on departure than the ones they are replacing, and at least 30% smaller on arrival.

Although planes are getting quieter, they still have an impact. That is why we will expect a six-and-a-half-hour ban on scheduled flights each night to be a requirement for development consent. This would also see the airport held to clear and legally enforceable noise performance targets. So, even with expansion, fewer people will be affected by aircraft noise than today. We also recognise the importance of providing local residents with a clear, predictable timetable of respite from aircraft noise. This is something that local communities value today and we will ensure that it continues once a new runway is built.

I recognise that this decision will have a big impact on people who live close to Heathrow, which is why we have insisted on a world-class package of supporting measures. Those communities affected by the decision will be supported by up to £2.6 billion towards compensation, noise insulation for homes and schools, improvements to public facilities and other measures. For those people whose homes need to be bought to make way for the new runway, Heathrow will pay 25% above the full market value of their home and cover all costs, including stamp duty, moving and legal fees—an offer significantly above the statutory requirement. In addition, I can announce the creation of a community compensation fund and that local authorities will benefit from our policy of local retention of business rates.

The second assurance I want to give is on costs for airlines and passengers. A new runway would bring in new capacity to meet demand and allow greater levels of competition, lowering fares relative to no expansion even after taking into account the costs of construction. This is an investment in our country’s future that will deliver major economic and strategic benefits to the UK, but it must be delivered without hitting passengers in the pocket. The Airports Commission was clear that this is achievable, as is the Civil Aviation Authority—not expansion at any cost but the right scheme at the right price. I expect the industry to work together to drive down costs for the benefit of passengers. As the regulator, the CAA will have a vital part to play in achieving this and ensuring that new capacity fosters competition. Its aim should be to deliver a plan for expansion that keeps landing charges close to current levels. I have full confidence in its ability to do so.

The third assurance I want to set out is around how the expanded airport will benefit the whole of the United Kingdom, not just by creating jobs across the airport’s UK-wide supply chain but by giving even more UK access to important international markets by strengthening existing domestic links and developing new connections to regions not currently served. The airport expects to add six more domestic routes across the UK by 2030, bringing the total to 14, strengthening links to existing nations and regions such as Northern Ireland, Scotland and the north of England and developing connections to new regions such as the south-west.

I am determined that Heathrow will meet these pledges, and the Government will hold the airport to account on this. Furthermore, government will take all necessary steps, including where appropriate ring-fencing a suitable proportion of new slots for domestic routes through public service obligations, to ensure enhanced connectivity within the United Kingdom. It is important to stress that this is a decision in the national interest and not just for the south-east.

So a new runway will strengthen the aviation sector across the whole nation, but we need do even more. Our airspace is out of date. Modernising it will boost the sector and help reduce noise and carbon emissions. We will soon bring forward proposals to support improvements to airspace and to the management of noise, including looking at how affected communities can best be engaged and whether there is a role for a new independent aviation noise body such as the commission recommended.

Finally, let me return to what happens next. There have been suggestions in the media recently that this process is slow or somehow delays construction. In fact, the opposite is true. Members will remember the saga of the planning process associated with terminal 5, which took years to resolve. Following that, the national policy statement process was designed, by the last Labour Government through the Planning Act 2008 and subsequently through the Localism Act 2011, to speed up major projects but in an open and fairer manner.

By setting out now why we believe there is a need for new runway capacity along with the supporting evidence we will fulfil our obligations to consult with the public and allow Members the opportunity to vote before it becomes national policy. That is what the law requires. This means that Heathrow will be able to bring forward a planning application safe in the knowledge that the high-level arguments have been settled and will not be reopened.

Today, the Government reached a view on their preferred scheme, and the national policy statement we publish in the new year will set out in more detail why we believe that it is the right one for the United Kingdom. It will also set out in more detail the conditions we wish to place on the development, including the supporting measures I outlined earlier. We want to make sure that we have considered all the evidence and heard the voices of all those who might be affected—and, of course, of all those who could benefit. The consultation will start in the new year and I can announce today that I have appointed Sir Jeremy Sullivan, the former Senior President of Tribunals, to oversee the consultation process. This is an independent role and Sir Jeremy will be responsible for holding the Government to account and ensuring that best practice is upheld.

The issue of runway capacity in the south-east has challenged successive Administrations for decades. There are strong feelings both for and against a third runway at Heathrow. This is not the same scheme that was previously supported in 2009. It does much more to mitigate environmental impacts, compensate communities and distribute benefits across the nation. This is an issue of national interest that touches every part of the United Kingdom, and which is vital to the economic prosperity and global status of our nation. I commend this Statement to the House”.

My Lords, that concludes the Statement.

Photo of Lord Rosser Lord Rosser Shadow Spokesperson (Home Affairs), Shadow Spokesperson (Transport) 4:41 pm, 25th October 2016

I thank the Minister for repeating the Statement made earlier today in the Commons by the Secretary of State for Transport. It is a Statement made against a backdrop of previous Conservative promises that, “no ifs, no buts”, there would be no third runway at Heathrow, a pledge given by the last Prime Minister and enthusiastically supported previously by the present Prime Minister and, it seems, her constituency local authority. The image of politics in this country has not been enhanced by today’s announcement in light of previous emphatic “no ifs, no buts” pledges, whether or not one thinks the now Government’s supported option announced today is correct.

While we welcome the fact that a decision on the preferred location for an additional runaway has been made, I want to pursue the question of the status of that decision. Apparently there is to be an extended though undefined period of further discussion and consultation which could last for a year or more before a final decision is made by Parliament. Is that correct? Is this further consultation in line with the national policy statement process in respect of only the implementation of the preferred option of a third runway at Heathrow announced today, or could the outcome of the consultation lead to a further change of heart by the Government away from their now declared preferred option? I would like a specific answer on that point.

Put another way, can the Minister confirm that all three options in the Davies commission report for additional runway capacity in the south-east are no longer on the table, and instead only the preferred option just announced is still there, and that likewise doing nothing to provide additional runway capacity in the south-east is not an option unless Parliament fails to approve the preferred option in a vote? Are we now at the stage as far as the Government are concerned of, “no ifs, no buts, it is a third runway at Heathrow and we the Government will consider only representations made in respect of its development”? If that is not the case, then uncertainty apparently continues for a further year or more.

Do the provisions of the national policy statement lay down that the further consultation must be of the length of time now suggested in some quarters? If not, why do the Government believe that such a further period of apparently extended consultation is needed before a final decision is made by Parliament if the only issues to be considered relate to implementation?

We have already said that, having asked the Airports Commission to undertake its report, there would have to be overwhelming evidence that the report and its conclusions were fundamentally flawed for us to depart from it. We will now need to consider the Government’s preferred option and the evidence to support the reasons they are putting forward for reaching that decision. We will expect to see the conclusions—and the evidence behind the conclusions—of the further investigations and analysis the Government have undertaken over the past 15 months following the publication of the Davies commission report. Perhaps now, today, the Government can tell us what impact they have concluded the preferred option of a third runway at Heathrow will have on achieving our climate change objectives and why.

I reiterate the four tests we have previously set out that any proposal for airport expansion must meet: that robust and convincing evidence is produced that the commission’s recommendations would provide sufficient capacity; that the United Kingdom’s legal climate change obligations can still be met; that local noise and environmental impacts can be managed and minimised; and that the benefits of any expansion are not confined to London and the south-east. We have already backed the Airports Commission’s recommendation that a statutory independent noise authority should be created, although apparently the Government have not yet done so.

We recognise the need for additional runway capacity in London and the south-east. Heathrow has been full for a decade and Gatwick’s single runway is the busiest in the world. Yet even following the announcement today, an additional runway is a decade or more away. What do the Government intend to do to address the runway capacity challenges that exist at present and will continue to exist until that additional capacity is provided? Do the Government have plans to utilise existing capacity in the south-east—for example, at Stansted and Luton—or are there any intentions to change practices at Heathrow or Gatwick in the short term to increase capacity? Indeed, what plans do the Government have for improving our international gateway airports around the UK, not least improving surface access by road and rail? There is no mention of this in the Statement. Does that mean that there are unlikely to be further capacity increases at our other airports? What will the Government’s position be if Gatwick still seeks to pursue its second runway option?

The Airports Commission said:

“The additional income generated as a result of operating a third runway should be allocated in a new way, and the airport should be obliged to develop a better and more collaborative relationship with its local communities, as some overseas airports have done”.

It went on to recommend that,

“a number of measures should be taken forward, in parallel with the approval, construction and operation of any new capacity at Heathrow, to address its impacts on the local environment and communities”.

These measures related to a “noise envelope” and,

“a ban on all scheduled night flights”, between specific hours. The commission also called for,

“periods of predictable respite to be more reliably maintained”, and compensation for,

“those who would lose their homes at full market value plus an additional 25% and reasonable costs”.

The commission said that the airport operator should deliver on,

“its commitment to spend more than £1 billion on community compensation”, which, together with,

“a new aviation noise charge or levy … would fund enhanced noise insulation and other schemes”, including support for schools. The commission also recommended:

“A Community Engagement Board should be established under an independent Chair, with real influence over spending on compensation and community support and over the airport’s operations … An independent aviation noise authority should be established with a statutory right to be consulted on flight paths and other operating procedures”, and called for:

“Training opportunities and apprenticeships for local people”, and:

“A major shift in mode-share for those working at and arriving at the airport”.

Finally, the commission said:

“Additional operations at an expanded Heathrow must be contingent on acceptable performance on air quality”, and:

“A fourth runway should be firmly ruled out”.

Should the final decision be an additional runway at Heathrow, we would expect those recommendations from the commission to be adopted and delivered. We will certainly insist that the Government set out very clearly and well in advance how they intend to ensure that those recommendations will be adhered to, what action will be taken to ensure that there is no backsliding and what action will be taken if there is. Will the Minister categorically assure the House that all of the commission’s recommendations, to which I have just referred, will be implemented?

The Government’s Statement, although it represents progress towards a decision, does not represent a final decision, since a final decision will not be taken for at least another year. Today, the House was hoping for a decision that represented certainty; it is unfortunate that the Statement falls short of that.

Photo of Baroness Randerson Baroness Randerson Liberal Democrat Lords Spokesperson (Transport)

My Lords, I predict that the decision made today will solve nothing because it will be locked in legal challenge for years to come. It is a decision that answers the questions of decades ago, not today’s questions. It is bad for the environment and it is bad for the UK as a whole because still more investment will be poured into the south-east, ignoring the potential of regional airports such as Birmingham and Manchester. It is bad for passengers because they will pick up the tab in the end. The eye-watering cost of this project, which the BA chief executive has called “outrageous”, will, in the end, fall on passengers. The interesting thing is that the Statement hardly had a pound sign in it, and the figures that were quoted were largely speculative about possible benefits to the economy.

What estimates have the Government made of the cost to the public purse of this whole development? How much of the massive cost of infrastructure improvements, which are essential if the Government are to meet their promises on air quality, will the Government pay? We know that Heathrow is expecting airlines to contribute up front and that BA is refusing to do so, so are the Government confident that Heathrow can finance its portion of the costs?

This will inevitably lead to additional charges for airlines. What work has been done to ensure that airlines are prepared to accept those additional costs and will not simply move elsewhere? Are the Government convinced—because I am not—that passengers are willing to pay more to fly from Heathrow, because airlines will pass the cost on to them? Heathrow promises six more domestic routes by 2030 and in the Statement the Government promise to hold it to account. How do they plan to do that?

This will be seen as a decision for the south-east, but faced with the huge challenges of Brexit, we need to engage the whole of the UK, so what additional investment will the Government now allocate to the Midlands and the north to allow regional airports to develop and grow?

On air quality, the Statement makes bold claims, but there is not one tiny detail on how this pollution revolution is to be achieved. Can the Minister give us more information? I note that the Statement is much more downbeat on noise; it simply accepts the concept that it will be a noisy procedure.

Finally, I want to address an issue that was not covered in the Statement: the ownership of Heathrow, which is only 10% British-owned. Although the consortium that owns it has distributed £2 billion in dividends to shareholders in the past four years, it has paid only £24 million in corporation tax in the last 10 years. Will the Minister assure us that this airport, which will be favoured with so much public investment, will at least pay its dues in taxation?

Obscene amounts of money have been spent on persuading us and the Government that Heathrow is the right decision. We know the Conservatives are hopelessly split on this issue and have broken their promises on it and that the Labour leadership has flip-flopped backwards and forwards on it, but we on these Benches have remained steadfast for two decades.

Photo of Lord Ahmad of Wimbledon Lord Ahmad of Wimbledon Parliamentary Under-Secretary (Department for Transport)

My Lords, I will come to that final point at the end. Bearing in mind that the decision that has been taken is one that has been put off for generations, I was expecting a slightly more positive response from both the Opposition and the Liberal Democrats, but I will take those questions on.

The noble Lord, Lord Rosser, asked about the 2009 proposal. I have said repeatedly from this Dispatch Box that this proposal is markedly different. I highlighted in the Statement I made earlier that a major part of that is the mitigation measures, both in addressing issues of noise pollution and in the compensation package that has now been presented. Some £2.6 billion has been put forward as the overall compensation package, while £700 million has been allocated for specific issues relating to noise. Ensuring ventilation and specifically double glazing for schools and residences is a practical measure that is reflective of the concerns that local communities were raising.

The noble Lord raised the issues on the process of consultation. Again, as I alluded to in the Statement, the Planning Act 2008, in terms of the NPS process that was created from it, was set up to deal with precisely this kind of infrastructure project to ensure that there are no further delays. The process that the Government are now following and are committed to is reflective of the provisions of that Act. What will happen hereafter, again in response to the noble Lord’s questions, is to ensure that there is an effective airing, an opportunity for concerns to be raised and, yes, scrutiny of the decision.

The noble Lord asked about other options on the table. As I said a week or so ago to my noble friend Lord Spicer—perhaps it was a tad longer—the Government are focused on ensuring that, as the Davies commission concluded, an additional runway should be delivered by 2030 in the south-east. That is where the focus is. Based on that, the Government have decided, after careful consideration of three viable options, that the new runway, the north-west runway at Heathrow Airport, is the Government’s preferred option, and the NPS will be based on that option.

The period of time involved is very much part and parcel of the legislative process. One thing concerned me about the noble Lord’s contribution: he himself acknowledged that Her Majesty’s Opposition had declared that they accepted the Davies commission findings. So do we; I have said so repeatedly from the Dispatch Box. However, the important issue was on additional environmental mitigation measures. He asked about that, and I am pleased to tell him that if he goes on to the website he should find those additional reports and conclusions within the reports that we have now also made available through the GOV.UK website. If he has additional questions, I ask him to take them up with me in writing, or we can have a discussion. However, these discussions are being answered.

I believe that Labour’s four tests that he articulated are met. He mentioned the statutory noise authority; I assure him that we will consult on that as part of this process. He mentioned the importance of regional connectivity; again, I stated in the Statement that regional connectivity is a key consideration, with six additional routes from Scotland to Northern Ireland and to the south-west. New routes will be created, and we will ensure that provisions are sustained to ensure local slots from the additional capacity that is created. Those are all parts of the Government’s growing commitment to ensure that this is a decision that benefits not just the south-east but the whole country.

With regard to other airports, HS2 as a practical example will make the travel time from London Euston to Birmingham International circa 30 minutes. That is about increasing connectivity. Crossrail provides an additional level of connectivity across London through the Heathrow hub to ensure that through those extra slots our other regions that are also better connected. Scotland has today welcomed the decision by the Government. The proposal for London Gatwick was very reasonable, practical, sensible, and, as I said, viable. Naturally, it is disappointed, but Gatwick remains part of the UK plc offering within the aviation sector.

There will be a specific six and a half hour ban on night flights which will be part of the planning process as we move forward. In terms of apprenticeships and local jobs, 77,000 jobs will be created as a result of the new runway. Over 5,000 apprenticeships will be created. There are much, if not all of what the noble Lord raised. It is not just a question of what is in this Statement, but the information that I have provided.

The contribution of the noble Baroness very briefly confused me. She said that it was bad for the UK. We are increasing capacity. If we do not increase capacity in the south-east for the benefit of the whole country, we are standing to lose a minimum of £21 billion. What is the Lib Dem solution? This is privately financed. Heathrow Airport has already committed to ensuring that those transport surface requirements are fulfilled as part of its equation. There is not a cost to the public purse.

I have already covered regional airports. I have already stated quite specifically that pollution targets will be met under the national air quality plan. In terms of British ownership, there are companies in the private sector that are owned differently. It is not for me to respond, but Heathrow airport has demonstrably shown its commitment to ensuring that south-east capacity—in this case, London—based on regional connectivity will be of benefit not just to the south-east, not just to London, but to the whole of the United Kingdom.

Photo of Lord Spicer Lord Spicer Conservative 5:01 pm, 25th October 2016

My Lords, together with the noble Lords, Lord Soley and Lord Clinton-Davis, my noble friends Lord Mawhinney and Lord Naseby and other noble Lords, I have been raising this issue of Heathrow, its runways and the London system in general for almost six years, on and off, in your Lordships’ House. As the song says,

“you never get nowhere by being too hasty”.

I shall ask two brief questions: one about Gatwick and the other about Heathrow. Does my noble friend agree that what Gatwick really needs is another terminal? The walkways to the aircraft are getting longer and longer. There is a massive crowd of people in the terminals now and at this rate everyone over the age of 50 will be pushed around in a wheelchair, which I suppose is one option. Gatwick does need, in my view, another terminal.

As far as Heathrow is concerned, does my noble friend agree that we now have a chance to reposition it again as the world’s leading long-haul airport, which is what it was when I was responsible for it and which I am sure it can become again? If it does, the effect on our trade and our ability to trade will be dramatic.

Photo of Lord Ahmad of Wimbledon Lord Ahmad of Wimbledon Parliamentary Under-Secretary (Department for Transport)

I thank my noble friend for his consistent promotion of the importance of south-east airport capacity. He can also take some comfort and credit in that his persistence has today delivered. It is an important step forward now that the Government have given a commitment to a specific scheme.

On my noble friend’s questions, it is now for Gatwick to decide. It has obviously accepted the decision that has been taken. As I have already said, I have visited Gatwick with my right honourable friend the Transport Secretary. We were impressed by its proposals and we will continue to work with Gatwick to ensure that it is very much part and parcel of our offering.

In terms of the overall airport offering for the UK and Heathrow, I agree with my noble friend. I wish to see London Heathrow, the south-east and the United Kingdom recognised throughout the world for its international connectivity which we are blessed with through our geographical location. However, we are now taking the decision to ensure we can provide that connectivity at a global level.

Photo of Lord Clinton-Davis Lord Clinton-Davis Labour

My preference is that Gatwick and Heathrow should both be expanded, but this decision is really about Heathrow. Although it has been provisionally selected, we still have to wait, and there is considerable uncertainty about the future. Meanwhile, Paris, Frankfurt and Schiphol will not wait, and British aviation will, regrettably, pay the price. Is that right? The Government hesitate. Behind all the Minister’s soft words, there is still hesitation, and there is no certainty that further delay will result in decisive action, which is what is required at the moment. Is there no possibility of speeding things up? Many people are divided on this issue. As a former Aviation Minister, I consider that we must act speedily, and the delay which the Minister recommends is not the right decision.

Photo of Lord Ahmad of Wimbledon Lord Ahmad of Wimbledon Parliamentary Under-Secretary (Department for Transport)

First, I assure the noble Lord that they are not soft words. I fully acknowledge that it may be a soft tone, which reflects the nature of your Lordships’ Chamber, but the message is very clear. The Government have today made a decision regarding the three viable options presented to us by a thoroughly researched report by the Davies commission. We have taken the decision today to proceed on one of those options: the new runway at Heathrow. Linked to that, we are following the designated process as laid out in the Planning Act 2008. I am sometimes asked how other countries have done this or that faster. We have a specific planning process that we need to follow; otherwise we are into the realms of other challenges—and I do not for a moment doubt that there will be other challenges. We need to ensure that our processes are robust, stand up to scrutiny and reflect our legislative processes. In this case, the 2008 Act is very clear and the national policy statement will now follow.

Photo of The Duke of Somerset The Duke of Somerset Crossbench

My Lords, first, we are not in an either/or situation. I think the Minister said that there would be no cost to the public purse, so is there any good reason why both Gatwick and Heathrow should not be allowed to develop an extra runway? This would provide competition for passengers and the extra benefits that the Minister outlined. Secondly, today’s announcement will have placed a great deal of blight on householders on the site in question. When will blight compensation be payable for people who wish to sell their houses now?

Photo of Lord Ahmad of Wimbledon Lord Ahmad of Wimbledon Parliamentary Under-Secretary (Department for Transport)

First, on the point about allowing for both, the previous Administration under the previous Prime Minister commissioned the Davies commission to look at proposals specifically focused on single-runway capacity in the south-east. The Davies commission started with 50-odd proposals and whittled them down to three. The Government’s focus is on delivering that single runway by 2030.

On the noble Duke’s second question about compensation, we are now moving into those realms. I talked about proposing the NPS in the new year and starting the consultation. We have made very public the package for those who are impacted directly, particularly those who are losing their homes. They will get 25% above market value and the costs of stamp duty, moving and legal costs associated with their having compulsorily to sell their homes.

Photo of Lord Naseby Lord Naseby Conservative

My Lords, does my noble friend recognise that his Statement today was clear and delivered with great clarity? He is also to be congratulated on listening on the compensation issues which have also been raised by my noble friend on the Cross Benches. There are other areas on which further work needs to be done. Will my noble friend the Minister look at noise abatement and the fuel efficiency of the aircraft that are likely to be coming out of Heathrow and used by the airlines in 10 years’ time? It is clear from all the evidence in the press and, indeed, from the recent report from the honourable Member for Richmond—who totally ignored it—that this is not understood by the public. As an ex-pilot, I have had a look at it, and it is extremely encouraging. Would my noble friend therefore publicise it, as it is crucial in terms of living conditions under the flight path and every other dimension in this very good Statement?

Photo of Lord Ahmad of Wimbledon Lord Ahmad of Wimbledon Parliamentary Under-Secretary (Department for Transport)

I thank my noble friend for his comments. It is important, now that we are moving into the realms of the specifics, that he mentioned noise. In the Statement I alluded to the fact that technology is moving on and gave examples of new aircraft that are coming on board. The reality is that in 2030, with the measures proposed, fewer people will be impacted by noise, from current estimates of 770,000 to 610,000 people. There are reasons for that. I mentioned the night bans that will run for six and a half hours. I also talked about the £2.6 billion package which includes a £700 million proposal to insulate homes around the airport. An additional £40 million is proposed to insulate and ventilate schools and public buildings. Of course I take on board my noble friend’s comments. I believe that as we move through the process of consultation and scrutiny of the proposals in the Commons and then on to the vote, and as the NPS comes to its final stage, many of the issues that my noble friend raised will be factored in.

Photo of Baroness Hamwee Baroness Hamwee Liberal Democrat

My Lords, I declare an interest as living under the flight path, and as president of HACAN—the Heathrow Association for the Control of Aircraft Noise. The announcement acknowledges that the current constraints do not fully work for residents by talking about “more reliable respite”. The Minister will be aware that the measurements of noise do not accord with residents’ experience. I am sure he will also agree that the best predictor of the future is past experience. In asking what confidence residents can have in assurances and conditions, I specifically ask the Minister about the words in the announcement that,

“the government proposes new legally binding noise targets”.

Can he explain how robust “legally binding” targets will be? Can he also tell the House whether the Government have ruled out, or will rule out, a sixth terminal?

Photo of Lord Ahmad of Wimbledon Lord Ahmad of Wimbledon Parliamentary Under-Secretary (Department for Transport)

First, the noble Baroness has probably answered her own question. By saying that something is “legally binding”, we mean we will ensure that it is enshrined.

Photo of Lord Ahmad of Wimbledon Lord Ahmad of Wimbledon Parliamentary Under-Secretary (Department for Transport)

I accept her proposition, however, that the judgment is often made by those who live under flight paths and have aircraft flying over them. The noble Baroness talked of her own experience. I assure her that I too have experience of planes flying over my own residence. I underline that the Government have outlined the importance they are attaching to the issues of noise and noise pollution. I also mentioned that we will consult on proposals on the noise commissioner and noise commission. That will be part and parcel of the consultation process. There are other measures such as setting up the local neighbourhood engagement board, which the commission detailed. That will also be part and parcel of the NPS and will be factored in as it makes its progress through the House of Commons.

Photo of Lord Soley Lord Soley Labour

I commend this Statement because it is an important step in the right direction, but we are not there yet. I have been in similar situations over the last 20 years on this issue. Can the Minister make sure that he brings on board everyone in the regions—particularly the airports that are desperate to expand their economic activity—in support of this proposal? This is not, as the noble Baroness, Lady Randerson, said, something for the south-east. This is for the country. I say that as someone who has lived under the flight paths for 40-odd years, and represented constituencies under them for a quarter of a century. The loudest voices are not necessarily the most representative. There are many, many people in those areas who know how important this is for jobs and prosperity.

There comes a point in time—which, frankly, we have passed—when you have to put national need above local issues. I found in my many years as an MP that I could carry people with me on this when I explained its importance. Many young people at the jobcentres in west London know the importance of that skilled employment at Heathrow. Let us get on with this and make a plea to those who are opposed to it to look at the depth and quality of the evidence in favour—from business and from all the trade unions bar one—and say that this project needs to go ahead, particularly in the light of Brexit, and in the light of the needs of the British economy.

Photo of Lord Ahmad of Wimbledon Lord Ahmad of Wimbledon Parliamentary Under-Secretary (Department for Transport)

I agree with much of what the noble Lord has said. He has been a strong advocate for this and, based on his own experiences, shares my sense, as Aviation Minister, of the importance of getting this done. One assurance I can give the House is that by the time the runway is built in 2030 and fully operational, I may no longer be the Aviation Minister—I will hazard that guess, but time will tell. He raises two very important points about getting everyone on board and ensuring that we build this extra capacity, which is not only of benefit to the surrounding area in terms of local employment—more than 77,000 jobs will be created from it, and businesses will benefit. The noble Lord is also right to point out the support from the business community and the unions. He mentioned the airports, many of which across the UK have not just acknowledged but welcomed the fact that the decision has been made. In answer to his question about bringing them around the table, over the last couple of weeks I have had various engagements with different people involved with the aviation industry, which included a very practical working lunch—I assure noble Lords that I had only the starter—with the Airport Operators Association, to ensure that the decision that we have taken today is of benefit to airports, the regions and the whole country.

Photo of Lord Howell of Guildford Lord Howell of Guildford Chair, International Relations Committee

The noble Lord, Lord Soley, has put it particularly well and clearly. The need has been emphasised for all parties this week to avoid further political dispute to give as much support as they can in making this difficult and obviously agonising decision a reality, and one with the minimum disruption. Would the Minister agree that extreme generosity is needed when it comes to compensation? He mentioned something about giving the full market price and 25% above it, but what is the full market price for a home already blighted? We must be careful that the real, genuine full market price is recognised and not some mingy reduction imposed by our Treasury friends that does not really compensate for the appalling upheaval that many families will have to face. Will he emphasise that point to his friends, and will he bring home to all who challenge the strategic decision that it must be part of a much larger network with much closer links to regional airports, as has been mentioned? We want rail links that are really modern, and maybe tunnelled—and maybe with magnetic levitation as well, which has been used in many railway systems already around the world. We are already out of date on that point. Of course, as has been rightly said, we need a vast reduction in engine noise. We have been promising constituents—or I did when I had some—for 30 or 40 years that that would come about. It is not there yet; there is still a horrific roar, if you live under a flight path, as I confess that I do. It is time that the whole leap forward in technology produced nearly silent aircraft for the future.

Photo of Lord Ahmad of Wimbledon Lord Ahmad of Wimbledon Parliamentary Under-Secretary (Department for Transport)

First, I agree on the noble Lord’s final point. As technology moves forward, it is important that manufacturers look at this issue. With the additional runway, the issue of respite for residents will improve. As for infrastructure and transport infrastructure, I totally agree with him. Just to clarify the point, when I talked about the market value, I was referring to the unblighted value—so it would be the market value as would exist in an unblighted form, not on the basis that this is near to the airport, in reflection of the challenges that certain people will face who will be subject to compulsory order. So it is the unblighted value, plus 25%.

Photo of Lord Young of Cookham Lord Young of Cookham Lord in Waiting (HM Household) (Whip)

I think it is the turn of the Cross Benches.

Photo of Lord Bilimoria Lord Bilimoria Crossbench

My Lords, it has taken a year since Howard Davies’s report for the Government to make this decision and we all know why it was delayed. Congratulations to the Government on making this decision at long last: business has been crying out for it. However, the Minister himself has just said that this project is going to be completed “up to 2030”—13 or 14 years from now. Other countries are building runways in a few years and many runways at a time. We want to invest in infrastructure: do this Government have the guts to do so? Let us look at the obstacles ahead: Zac Goldsmith has said that this is a,

“millstone around the Government’s neck”, and that the plan is “doomed”. Our Foreign Secretary has said that it is “undeliverable” and that he sees,

“an inevitable fight in the courts and I think the chances of success for the proponents of the third runway are not high”.

Justine Greening, the Education Secretary, is opposed to Heathrow expansion. Even the Mayor of London, Sadiq Khan, has expressed his anger about the decision. Our Prime Minister expressed her opposition to Heathrow in 2009. With all of business crying out for this to happen but all this opposition, there is going to be a lot of resistance to it. As my noble friend said earlier, why did the Government not go ahead and allow Gatwick and Heathrow to expand? Does the Minister not agree that a Gatwick expansion could go ahead straightaway? Heathrow would happen sequentially thereafter, I hope.

Finally, what about employment? The Government have estimated that there will be up to 200,000 extra jobs—over £200 billion created in the economy. Where are those people going to come from? We have the highest level of employment and the lowest level of unemployment and we are reliant on 3 million people from the European Union working over here. Will people from the European Union be allowed to work on these airport expansion projects, because they will be needed?

Photo of Lord Ahmad of Wimbledon Lord Ahmad of Wimbledon Parliamentary Under-Secretary (Department for Transport)

I thank the noble Lord for his welcome of the decision. I am sure he will understand if, in the interests of time, I write to him on his specific questions. I underline that we are committed to ensuring that we make difficult choices. He used the example of my right honourable friend the Prime Minister. She herself chaired the sub-committee meeting which made this decision today. That perhaps underlines her commitment to making tough calls in the best interests of the nation. As to the Government’s commitment to infrastructure, do I need to say more than HS2—£55 billion for regional rail connectivity to ensure that all our regions are serviced in the best way possible? We are also investing in Crossrail, the biggest infrastructure project in Europe. Other countries are now looking towards the United Kingdom to ask, “How did you do it?”. This is how UK plc, under this Conservative Government, is delivering on infrastructure for our country: we are committed to it. I will respond to the noble Lord on his specific issues, but extra capacity means more investment, more companies, more air slots, and more airlines looking to expand. That does mean more jobs.

Photo of Baroness Tonge Baroness Tonge Independent Liberal Democrat

My Lords, is the Minister aware that, after the planning inquiries for the fourth and fifth terminals—I gave evidence to both of them—we were told and promised faithfully that there would be no further development at Heathrow? So that we are clear what is ahead of us, what does he expect to be the next development, once the third runway is under way? Could he also tell us how many migrant labourers will be needed to complete the project?

Photo of Lord Ahmad of Wimbledon Lord Ahmad of Wimbledon Parliamentary Under-Secretary (Department for Transport)

I have already outlined the issue of infrastructure. The Government will continue to invest in infrastructure projects. On the issue of when the runway is built, the Davies commission said that it should be delivered by 2030. We will, of course, be working with Heathrow Airport to ensure it is delivered earlier. As to specific forecasts of future big infrastructure projects, I can certainly visualise some but I will keep my counsel on them. On the question of migrant workers, the case has been made today for a commitment to building a new runway, whatever is required to ensure that we deliver it, within whatever environment we are working in. I have already alluded to Crossrail, a world-class project which people look up to: we are delivering it. So, notwithstanding the challenges we have, I am confident that we will be able to deliver.

Photo of Lord Howarth of Newport Lord Howarth of Newport Labour

Has the Minister noticed that when faced with the need to take a decision on aircraft capacity in the south-east, which would cause dismay to middle-class voters in marginal constituencies, this Government dithered and procrastinated for year after year—whereas when it came to making decisions such as cuts in social security, which would cause deep distress to working-class voters in constituencies that the Conservative Party does not hope to win, this Government acted without hesitation or scruple? What has that done for the reputation of politics, and how would the Minister characterise a Government of that kind?

Photo of Lord Ahmad of Wimbledon Lord Ahmad of Wimbledon Parliamentary Under-Secretary (Department for Transport)

Simply put, the Prime Minister has made it clear that this is a Government who will ensure that this is a country that works for everyone—and that is what we are delivering. I do not share the noble Lord’s negative view when he says that we are afraid of making tough calls and tough decisions. What is today’s decision? What was the decision on building HS2? I suggest to him that many of the constituencies impacted by the HS2 development are not—nor will they be in the future, inshallah—held by the Labour Party, but are Conservative seats. This is about what is important in the national interest. That is what this decision is, and we are not going to be deterred from making tough calls.

Photo of Lord Mawhinney Lord Mawhinney Conservative

My Lords, on behalf of the many people who for years have believed that there needed to be further airport expansion in the south-east, will my noble friend convey to the Prime Minister and the Secretary of State for Transport our thanks for the fact not just that they have made a clear decision, but that they recognised the urgency of making that decision and got on with it? Secondly, I hope he does not mind if I ask for a little clarification of his Statement. I am not clear whether the consultation over the next 12 months will cover everything that was included in the Statement, or whether it will just be focused on the decision to have the runway at Heathrow. Perhaps he could help us to understand that.

Photo of Lord Ahmad of Wimbledon Lord Ahmad of Wimbledon Parliamentary Under-Secretary (Department for Transport)

On the second practical point, the Government are clear that we have now taken a decision that is focused on the additional runway at Heathrow. The consultation will be focused specifically on ensuring that the challenges, and that runway, can be delivered. On his other point, I thank the noble Lord for his support. Of course I will convey his sentiments to my right honourable friends the Prime Minister and the Secretary of State.

Photo of Lord Empey Lord Empey UUP

My Lords, the Minister said in his Statement that he is strengthening connectivity for passengers right across the UK. It does not matter how many runways are built. The question is: are there slots for the regions to get access to them? The Minister will know that my Airports (Amendment) Bill, which I introduced some time ago, was designed to guarantee slots. He said that he could not guarantee them because of European Union legislation—but now that we are leaving the European Union, will he, with the vigour, robustness and determination that only he can deliver, take my Bill, which was well ahead of its time, strongly support it, and implement the legislation to guarantee the slots for regions?

Photo of Lord Ahmad of Wimbledon Lord Ahmad of Wimbledon Parliamentary Under-Secretary (Department for Transport)

I have always regarded the noble Lord as a forward-looking Peer in your Lordships’ House, and he and I have spoken extensively about the importance of regional connectivity. Today’s decision delivers that very regional connectivity. Indeed, Northern Ireland will benefit from the extra availability of slots and connectivity; it will be one of the six regions to benefit directly from this decision. On the issue of PSOs, which he has previously raised, he knows that there are decisions that we have taken—most recently to protect particular routes connecting to London to ensure the continued growth and prosperity of different regions, including Northern Ireland.

Photo of Lord Hain Lord Hain Labour

My Lords, I support the Government, not because there are not important residential and environmental concerns—because there are—but because this decision is genuinely in the national interest of Wales, the West Country, the Midlands, the north, the east and, indeed, the south-east, and because it is the only hub airport capable of getting back some of the traffic we have lost to Paris and Charles de Gaulle. Will the Minister confirm that the decision has already been made to allow traffic by rail from the West Country and south Wales via Reading to go straight to Heathrow? That is important.

Photo of Lord Ahmad of Wimbledon Lord Ahmad of Wimbledon Parliamentary Under-Secretary (Department for Transport)

I thank the noble Lord for his support. He raises important issues about the commitment already made on the links into Heathrow, particularly the lines which he mentioned. Certainly, it is our intention not only to remain committed to them but to look at how we can perhaps bring them forward to reflect the nature of the development of the new runway at Heathrow.

Photo of Lord Young of Cookham Lord Young of Cookham Lord in Waiting (HM Household) (Whip)

I think we might hear from the noble Lord, Lord True, first.

Photo of Lord True Lord True Conservative

My Lords, I declare an interest as someone who has for 30 years represented some of those people who accept 500,000 flights a year over their heads and do their bit for the national interest. Will my noble friend consider that expanding Heathrow will increase foreign monopoly-owned power and weaken airport competition in the London area? It will affect hundreds of thousands more people than the Gatwick option would have done. It will add to safety and security risk by sending hundreds of thousands more flights over our most densely populated areas. It will cost at least £8,000 million more than the proposed Gatwick option and it will take longer to build than that option, keeping Britain closed for business for longer. Which of those propositions does my noble friend not accept?

Photo of Lord Ahmad of Wimbledon Lord Ahmad of Wimbledon Parliamentary Under-Secretary (Department for Transport)

My Lords, I accept my noble friend’s point that Heathrow expansion is more expensive than the alternative proposals that were on the table but, equally, it offers that much greater benefit. He asked how this would benefit other airports and said that it may suppress competition. One practical example I can give him in the time I have is that London City Airport has welcomed today’s announcement.