Government to back ‘gold-plated’ Heathrow expansion

The UK Government is advancing a contentious £49 billion plan for a third runway at Heathrow Airport, a decision that has drawn significant criticism from major airlines. Transport secretary Heidi Alexander is set to confirm the endorsement of Heathrow Airport Limited's (HAL) proposal, which includes building a runway over the M25 motorway. This move comes despite strong warnings from carriers such as IAG, owner of British Airways, and Virgin Atlantic, who argue the expansion will dramatically increase costs for both airlines and passengers.

Airlines express deep concern over the financial implications, with IAG previously cautioning that passenger fees could double under HAL's £50 billion option. Sean Doyle, British Airways' chief executive, specifically advocated against rerouting the M25, a key feature of HAL's more ambitious design. The International Air Transport Association (IATA), the global airline industry body, has also labeled Heathrow's proposal "unaffordable" under the existing regulatory framework, criticizing what it calls an "addiction to gold-plated construction costs."

The UK Department for Transport's decision favors HAL's vision over an alternative, less disruptive plan submitted by hotel tycoon Surinder Arora, known as Heathrow West, which proposed a shorter runway to avoid the M25 reroute. While Arora's current bid is effectively sidelined, the door remains open for revised proposals aligned with the government's preferred direction. The expansion also anticipates an overhaul of the Civil Aviation Authority (CAA) rulebook to accommodate the project's scale and complexity.