Reeves confirms backing for 3rd runway at Heathrow, and says she wants plan brought forward by summer
Reeves is now talking about Heathrow.
The question of whether to give Heathrow, our only hub airport, a third runway has run on for decades.
The last full length runway in Britain was built in the 1940s no progress in 80 years.
Why is this so damaging? It’s because Heathrow is at the heart of the UK’s openness as a country. It connects us to emerging markets all over the world, opening up new opportunities for growth.
Around three quarters of all long haul flights in the UK go from Heathrow. Over 60 per cent of UK air freight comes through Heathrow, and about 15 million business travelers used Heathrow in 2023.
But for decades, its growth has been constrained. Successive studies have shown that this really matters for our economy. According to the most recent study from Frontier Economics, a third runway could increase potential GDP by 0.43% by 2050. Over half, 60% of that boost would go to areas outside of London and the south-east.
She criticises the last government for not acting to ensure a third runway was built.
So I can confirm today that this government supports a third runway at Heathrow and is inviting proposals to be brought forward by the summer.
We will then take forward a full assessment through the airport National Policy Statement. This will ensure that the project is value for money, and our clear expectation is that any associated surface transport costs will be financed through private funding, and it will ensure that a third runway is delivered in line with our legal, environmental and climate objectives.
Key events
John McDonnell, the former shadow chancellor and a longstanding opponent of a third runway at Heathrow, thinks Rachel Reeves’ announcement could do “irreperable” damage to Labour. He posted this on social media.
This is such a huge political, economic & especially environmental mistake that sadly I fear it will inflict an irreparable scale of damage on the government.
Sadiq Khan, the Labour mayor of London, has confirmed that he remains opposed to a third runway at Heathrow. In a statement this morning he said:
I remain opposed to a new runway at Heathrow airport because of the severe impact it will have on noise, air pollution and meeting our climate change targets.
I will scrutinise carefully any new proposals that now come forward from Heathrow, including the impact it will have on people living in the area and the huge knock-on effects for our transport infrastructure.
Despite the progress that’s been made in the aviation sector to make it more sustainable, I’m simply not convinced that you can have hundreds of thousands of additional flights at Heathrow every year without a hugely damaging impact on our environment.
Backing Heathrow 3rd runway ‘most irresponsible announcement’ since Truss’s mini-budget, say Greens
The Green party has described the decision to approve a new runway at Heathrow as “the most irresponsible announcement from any government” since the Liz Truss mini-budget. This is from the Green MP Siân Berry.
The chancellor talked about the ‘costs of irresponsibility’ but expanding airports in the face of a climate emergency is the most irresponsible announcement from any government I have seen since the Liz Truss budget.
The chancellor also talked about ‘the sights and sounds of the future’, but these will be dismal for millions if the government doesn’t take the action the UK has promised to cut carbon. We are already seeing the impact of climate breakdown on extreme weather and this will only get worse if ministers remain distracted by the lobbying of the most wasteful form of transport.
We are also expecting formal planning decisions from ministers on Gatwick and Luton airport expansion, which the Chancellor pre-empted today. Giving these permissions in the month before vital new advice arrives from the Climate Change Committee, is nothing short of reckless.
The Conservatives have also released a statement responding to Rachel Reeves’ speech. Mel Stride, the shadow chancellor, said:
The biggest barriers to growth in this country are Rachel Reeves, Keir Starmer and their job destroying budget – and nothing in the chancellor’s speech proved otherwise.
What’s worse, the anti-growth chancellor could not rule out coming back with yet more tax rises in March.
This is a Labour government run by politicians who do not understand business, or where wealth comes from. Under new leadership, the Conservatives will continue to back businesses and hold this government to account.
The Liberal Democrats are the most pro-European of the main UK parties and recently they firmed up their Brexit reversal credentials, firmly coming out in favour of rejoining the customs union. Their response to Rachel Reeves’ speech focuses on the fact that she hardly mentioned the EU. Daisy Cooper, the Lib Dem deputy leader and Treasury spokesperson, said:
The chancellor’s blinkered approach on Europe is holding back British businesses and stifling growth.
If this government was serious about boosting growth, it would start negotiating a new UK-EU trade deal with a bespoke customs union at its heart.
This is the single biggest lever ministers could pull to turbocharge our economy. The refusal of the chancellor to even consider it shows a worrying lack of ambition.
Q: [From Natasha Clark from LBC] Companies says 10,000 retail jobs are at risk because of your plans. Are you gaslighting British business?
Reeves says says Heathrow expansion could create 100,000 jobs. And other plans she announced will create jobs too. So the plans are good for wealth creation, she says.
And that’s the end of the press conference.
Q: [From Sophie Huskisson from the Daily Mirror] Are you worried deregulation could be bad for safety?
Reeves says the government has made commitments to learn lessons from the Grenfell fire tragedy. The government will not renege on those commitments, she says.
Q: [From City A.M] Is intervening with regulators good for business?
Reeves says businesses know what is best for investment. They have complained about regulations.
There’s a lack of predictability in our regulators, which is bad for business and bad for our economy. So I won’t apologise for wanting to reform how regulation works in Britain.
Reeves does not rule out using spring statement to make tax changes
Q: [From Daniel Martin from the Telegraph] Can you rule out introducing tax and spending measures in the spring statement? You might be missing your fiscal rules by then.
Reeves says that is two months away. She won’t give a running forecast. A lot can change, she says.
But she says the fiscal rules are non-negotiable.
I am not going to write five years’ worth of budgets in the first six months of office, but that was a once-in-a-generation budget to fix the inheritance and to draw a line under the economic and fiscal mismanagement of the Conservatives.
Q: [From Heather Stewart from the Guardian] Do you regret the gloomy tone you adopted after the election, and did you and the PM talk down the economy?
Reeves says she faced a very difficult situation. If she had shied away from those difficult decisions, the situtation would be worse today, she says.
She says interest rates have been cut twice since Labour was elected. Inflation is close to target. And wages are rising at twice the rate of inflation. So stability has returned, she says.
Q: [From Harriet Line from the Daily Mail] Will you drop the employment rights bill, which business say is adding to their costs.
Reeves backs the bill, saying a secure workforce is a more productive workforce.
Q: [From Christopher Hope from GB News] Will you impose a cap on net migration? And will you publish your tax returns?
Reeves says the government is committed to getting net migration down.
She thanks Hope for reminding people the tax return deadline is coming up. But she says chancellors have not published their tax returns in the past, and she does not plan to.
Q: [From Andy Bell from 5 News] Business say the biggest problem is the new taxes they face. Will you roll them back? And can you rule out further tax increases for business?
Reeves says she has not heard any “serious alternative” to her plans. The Tories back the investment in the budget, but not the tax rises that will finance those plans.
She says the CBI has backed the plans announced today. Other business leaders are supportive too.
Q: Will you rule out further tax rises?
Reeves says she won’t write five years’ of budgets. But that was a “once in a generation budget”.
Q: [From Ed Conway from Sky News] Some of these plans will take a long time to come to fruition. How will you judge if this is working? GDP? GDP per capita? Living standards?
Reeves says the Plan for Change says the government wants living standards to improve.
She says there is no point in announcing infrastructure plans if you are not also changing planning rules. The government is doing that, she says.
Reeves is now taking questions.
Q: [From Chris Mason from the BBC.] What happens if this is not enough?
Reeves says her plans show this is government with ambition.
She says the UK is not connected to other places around the world, because the slots are not available at Heathrow. The government is turning that around, she says.
Article by:Source: Andrew Sparrow
