Heathrow third runway GDP boost may be 90% lower than earlier estimates
8 reported
Government analysis indicates the economic benefit of a third runway at Heathrow could be far smaller than previously stated, with the Department for Transport estimating a GDP increase of up to 0.05% — a 90% reduction from the 0.5% figure previously cited. The DfT’s net present value calculation for the project, even if privately financed, ranges from -£23.4bn to -£62.5bn, meaning the social and environmental costs could outweigh the benefits. The appraisal includes positive benefits to passengers of between £29bn and £42.4bn, but estimates social and environmental impacts of £58bn to £82bn, plus a £25bn drop in profits for airlines and other airports. Chancellor Rachel Reeves has championed rapid expansion as a priority for economic growth, and the government launched a consultation for the next legislative stage on Thursday. Heathrow argued the DfT model excludes other economic competitiveness gains, while a government spokesperson said the figures are “only part of the picture.” The proposed 3,500-metre runway would divert the M25, demolish about 800 homes, and add roughly 276,000 extra flights per year, with estimated costs between £32.7bn and £52.4bn.
What’s reported
DfT analysis says the third runway could boost GDP by up to 0.05%, 90% less than the previously stated 0.5%.
The net present value of the scheme is calculated at between -£23.4bn and -£62.5bn.
Positive benefits to passengers are estimated at £29bn to £42.4bn, but social and environmental impacts are £58bn to £82bn.
Airline and other airport profits are expected to fall by about £25bn.
The runway would be 3,500 metres, divert the M25, demolish about 800 homes, and add about 276,000 extra flights per year.
The project cost is estimated at £33bn, with an independent assessment putting it between £32.7bn and £52.4bn.
A DfT health impact assessment says the runway could harm the health and wellbeing of up to 3 million people living near Heathrow.
The government announced the next stage of rapid approval, with a consultation before a vote by MPs and spades in the ground promised by 2029.
Key figures
Rachel Reeves, chancellor
Alex Chapman, head of economic policy at the New Economics Foundation
Olly Glover, Liberal Democrat transport spokesperson
DfT spokesperson (unnamed)
Heathrow (unnamed spokesperson)
Sources: The Guardian
