Rachel Reeves has announced her support for a third runway at Heathrow as she battles to get Britain’s economy back on track.
“A third runway is badly needed”, she said.
In a major speech, the chancellor also unveiled plans for nine new reservoirs, thousands of new homes in Cambridge and a “growth corridor” including road and rail upgrades to Oxford.
Reeves deployed these plans as demonstrations of the government’s commitment to economic growth.
The chancellor said: “I am not satisfied with the position that we are in. While we have huge amounts of potential, the structural problems in our economy run deep, and the low growth of the last fourteen years cannot just be turned around overnight.
“This has to be our focus for the duration of the parliament, because the situation demands us to do more. And today, I will go further and faster in kick-starting economic growth.”
She added: “I come to the decision that perhaps more than any other, has been delayed, has been avoided, has been ducked. 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% of UK air freight comes through Heathrow, and about 15 million business travellers 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 in creating increasing trade opportunities for products like scotch whisky and Scottish salmon, already two of the biggest British exports out of Heathrow and a third runway could create over 100,000 jobs.
“For international investors, persistent delays have cast doubt about our seriousness towards improving our economic prospects…
“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 service transport costs will be financed through private funding.
“It will ensure that a third runway is delivered in line with our legal, environmental and climate objectives.”
The speech is considered a key moment for a chancellor who has struggled with sluggish economic headwinds since she delivered the autumn budget in October last year.
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Josh Self is Editor of Politics.co.uk, follow him on Bluesky here.
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Source: Politics
