Future airport expansion: is there a right answer?

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One of the first decisions of the Coalition government in 2010 was to find a means of putting off making any decision about airport expansion, by the simple expedient of creating the Airports Commission under the chairmanship of Sir Howard Davies, whose remit was to recommend the best way forward for airport capacity, particularly in the South East, and who were not to report their findings until after the 2015 election.

 

In some ways, this was a clever political fudge, in that it prevented the coalition getting drawn into internal or external arguments about whether there should be expansion at all, and if so, where that expansion should take place. However, as happens so often with compromises, it simply delayed a decision, without really making it any easier for anyone to decide how to address the problems.

 

For anyone working in travel and transport, it is clear that the UK does have a problem around aviation capacity. Heathrow is, to all intents and purposes, completely full. It can make very small increases in total passenger throughput, but primarily by the airlines who already have slots putting larger aircraft on their routes into Heathrow. Gatwick is full for large parts of the day, although it does have a little more flexibility. In any event, Gatwick has the proud boast, which is something of a double edged sword that it is the airport with the busiest single runway in the world.

 

The major problem this creates is in relation to resilience – the slightest problem at either airport causes aircraft to stack up, and ultimately results in delays or cancellations for passengers. It also adds to pollution and environmental damage as aircraft are forced to hold before being able to land, burning more fuel and creating more noise over the areas in which they are holding.

 

Whilst the anti airport expansion campaigners would have us believe that the solution is simply to allow some expansion at the other airports in the UK, this fails to accept the reality that to be successful, airports need to be relatively close to the markets they serve. In theory, in a small(ish) country with around 22 commercial airports in England, and a further handful in Scotland and Wales, it should be easy to spread capacity and encourage air travellers to use other gateways. However, we have to accept that London and the South East is a honey pot. More than 10% of the UK population live inside the M25, and probably 40% of the total population regard Heathrow or Gatwick as their local airport. Overseas visitors primarily visit London on their trips to the UK. More than 50% of overseas visits are to London, and around 53% of total overseas visitor spend is in London. As a result, airports serving London are, and will continue to be those with the most demand.

 

The other important factors to bear in mind are that the UK population continues to grow – and some of that growth is fuelled by migration. It is interesting to look at the volumes of VFR traffic from the UK. People returning home to visit their friends and relatives have continued to grow, even at a time when total air traffic flows have been relatively static, and many of those migrants live in the south east. Equally, as the UK economy strengthens, the desire to travel will also grow again, and then the shortfalls in airport capacity in the south east will become blindingly apparent. For similar reasons, a growing economy should bring with it more business and leisure travel into the UK, all of which needs means of entry. Governments are slowly beginning to see the benefits of tourism, but some of those benefits can only be recognised if tourists can get here easily.

 

All of these factors have been recognised by the Airports Commission in producing its interim report in 2013, which as well as recommending some minor “tweaks”, also recognised that the south east would ultimately need at least one extra runway by 2030. With some qualifications, it effectively made a binary decision – expansion would need to take place at either Gatwick (by adding a second runway) or at Heathrow (either by adding a new runway, or by a major extension to the northerly runway, creating an effective third runway). It didn’t dismiss the possibility of a complete new build – the so called “Boris Island” option, but considered that this would need careful analysis, and would probably ultimately be ruled out on cost grounds.

 

It should also be remembered that whichever option is recommended by the Airports Commission after the General Election, this is only a recommendation, and that simply starts the process. Politicians may try to continue to push the decision back, in the hope that it becomes someone else’s problem.

 

Over the course of 2014 and into 2015, both Heathrow and Gatwick have been running vigorous campaigns to promote the merits of their respective solutions, with those campaigns being aimed at the Airports Commission itself, MPs and other opinion formers and the travelling public. It is difficult to travel around greater London without seeing some evidence of those campaigns – whether that be “Taking Britain Further” or “Gatwick Obviously”.

 

So, is there a right answer?

 

The advantages of Heathrow is that it is larger to start with, is already seen as the UK’s major hub, and is better located to capture traffic from a wider part of the UK. Against this, it has to be recognised that its flight paths involve aircraft passing over large parts of London, causing some noise disruption – although modern aircraft are so quiet that in practice that disruption is relatively small. The Heathrow plans would also be extremely expensive to implement, and when coupled with traffic issues on the M25, have a greater air quality impact.

 

Gatwick is in a different situation. The solution would be significantly cheaper, and would affect a much smaller population. Gatwick has recently offered commitments to the Airports Commission that if it was approved, it would hold its prices during the expansion phase, something which existing airline users and customers would welcome. The disadvantages of Gatwick are partly driven by its location to the south of London – less accessible to parts of the UK, as well as the fact that it is not really the airport of choice of international travellers.

 

Trying to balance these factors will probably cause a problem to the Airports Commission. However, as they should be less tainted by political considerations, they may be more inclined to recommend Heathrow. The cost issues remain a large problem though. Unlike any other form of public transport, the users have to pay the full cost of infrastructure without any government support. This means that the costs of any new runway would be met by airlines and their passengers, and as most of the costs have to be met before the runway is operational,  it is probable that there would be increases in Heathrow’s already high airport charges. That is one of the reasons why Gatwick thinks that it may have the edge in any decision.

 

In practice, I suspect that most airport users would probably agree with the views expressed by Michael O’Leary when he appeared before the House of Commons Transport Select Committee in November 2012:

“..it seems to be a relatively simple issue of developing more runways in the south-east and developing them quickly. Instead of faffing around worrying about hubs and point-to-point, we should create excess runway capacity for the south-east, which would allow us to reverse five or six years of traffic and visitor declines and create an environment where aviation in the UK, or at least the development of a coherent aviation strategy in the UK, would allow the industry to grow visitor numbers, tourism and jobs.”