No confirmation by government that taxpayer won’t have to fund surface access transport for Heathrow 3rd runway
Transport for London calculated the costs of upgrading and improving surface access, to deal with the extra passengers using a 3 runway Heathrow could be up to about £18 billion, over several years. Heathrow has only offered to pay a total of £1.1 billion. Stephen Hammond, a former transport minister, (2012 – 14) asked Chris Grayling about the costs, as did other MPs. The responses were evasive. Stephen Hammond believes the transport work is likely to cost the taxpayer (= us) at least £5-10 billion, and the government is misinforming the public by announcing that: “Expansion costs will be paid for by the private sector, not by the taxpayer.” Asked about the costs, Grayling replied that Heathrow …”will be held to a plan that: first, does not increase the current level of road transport to the airport; and, secondly, increases public transport access to the airport to 55% of those using it. Those will be obligations that it will have to fund. The Government’s financial advisers have said that that is viable and investible. There are question marks about what schemes are actually part of the surface access. Some of them we have to do anyway. For example, we are about to start improvements to the M4, which will benefit Heathrow and improve access, but they are not solely about Heathrow.” ie. no clarity at all, and sounds as if government realise Heathrow cannot even build the runway etc without raising landing charges, let alone all this work. So is not insisting on it …?
This is what Chris Grayling said on 25th October 2016 in the House of Commons, (Hansard) on how much the taxpayer would have to pay, to improve surface access – because of a Heathrow 3rd runway:
Respected outside experts have estimated the need for £11.5 billion of taxpayer support for the third runway and even the Airports Commission suggests up to £5 billion, yet post the Cabinet meeting this morning, the Government website says that the expansion costs will be paid for by the private sector. I listened carefully to the Secretary of State’s statement, but he did not reiterate that commitment. Will he tell the House how much the taxpayer will have to put in for runway three and the associated surface works?
The most fundamental point is that Heathrow has committed, and will be held, to a plan that: first, does not increase the current level of road transport to the airport; and, secondly, increases public transport access to the airport to 55% of those using it. Those will be obligations that it will have to fund. The Government’s financial advisers have said that that is viable and investible. There are question marks about what schemes are actually part of the surface access. Some of them we have to do anyway. For example, we are about to start improvements to the M4, which will benefit Heathrow and improve access, but they are not solely about Heathrow. There are, however, some very clear obligations in terms of actual deliverables that the airport will have to meet and pay for.
Heathrow third runway: public bill up to £10bn hidden, says Tory MP
Former transport minister Stephen Hammond urges government to ‘come clean’ over probable bill to taxpayers
By Gwyn Topham (Guardian)
Wednesday 26 October 2016
The true cost of Heathrow airport expansion to the taxpayer is not being divulged by the government, according to a Conservative former transport minister, who said ministers needed to “come clean” over the probable £5bn-£10bn public cost for road and rail links.
Tory MP Stephen Hammond raised his concerns as it emerged that Heathrow executives would get millions in bonuses for securing approval for the £17.6bn third runway scheme.
Hammond, a transport minister from 2012-14 when the airports commission was studying the scheme, said the government was misinforming the public by announcing that: “Expansion costs will be paid for by the private sector, not by the taxpayer.” The transport secretary, Chris Grayling, had also omitted this in his statement to the house, he said.
MP Stephen Hammond says Heathrow expansion costs will not fall to the private sector, as ministers claim.
“There will be a number of specific things we will be doing for Heathrow. The government and Heathrow need to come clean on what the cost to the taxpayer is going to be. No one would be surprised if it is £5bn, but we should just be honest about it,” Hammond added.
While the commission report estimated a £5bn bill for new roads and rail links, Transport for London put the potential cost as being as high as £18.4bn.
Heathrow said it had earmarked just £1bn, and that it only accepted direct responsibility for works to the M25, which the third runway would cross, and a few minor roads. The airport contends that it will be cutting traffic, despite adding up to 55 million passengers a year, and that revenues could offset the bill.
….. and it continues on other topics about Heathrow ….
Heathrow: Commission ignored TFL warnings on transport costs
October 26, 2016
by Emma Howard and Damian Kahya (Greenpeace, Energy Desk)
The Airports Commission ignored warnings by Transport for London (TfL) that they underestimated the costs associated with expanding Heathrow by more than £10 billion, Energydesk has learned.
On Tuesday the government approved the expansion of Heathrow, based on the recommendation of the independent Airports Commission.
In its final report published in July 2015 (pdf), the Commission made a “clear and unanimous” recommendation that a third runway be built at Heathrow, putting the cost at £17.6bn, plus £5bn for surface transport costs.
But TfL told Energydesk on Tuesday that they had informed the Commission on several occasions that their analysis was a vast underestimate.
In a response to the Commission’s consultation submitted in February 2015 (pdf), London’s transport regulator called upon the Commission to do a re-assessment and clarify whether the taxpayer or the airport would foot the bill, an issue that appears to be unresolved.
“TfL estimate that the Commission is underestimating the surface access cost of expansion at Heathrow and Gatwick by more than £10bn,” they said.
The Commission’s analysis relied on “short-term” and “optimistic” assumptions about passenger and staff demand and a “full, long-term surface access assessment” was needed, they added.
TfL’s own analysis put the price tag as high as £18.4bn, a discrepancy that first emerged in documents revealed by an Energydesk investigation in April.
But the government said they do not recognise the figure, disputed whether all the transport upgrades will be required and suggested that those included by the Airports Commission will be subject to further assessment.
A government spokesperson told Energydesk: “We don’t agree airport expansion will require £15-20 billion. That figure includes a whole range of projects that may or may not be used in the future related to population growth. There are ongoing rail and road projects that will take account of population and economic growth. In a couple of years time we will have a much clearer idea of what will be required.”
However TfL said they had not included any projects that were already “funded and planned”.
Heathrow also dismissed the TfL analysis.
The £18.4bn figure emerged in internal Transport for London (TfL) spreadsheets and slideshows that were released following an investigation by mobility and environmental campaigners.
Read the documents (Google Drive)
The TfL analysis suggested the Commission failed to take into account the costs of key rail schemes, extra buses, additional operational spending and road traffic management.
Background travel demand will be higher than assumed by the Airports Commission with the GLA’s new interim employment forecasts. (And see graph)
Both sets of estimates include the costs of major road schemes such as putting part of the M25 in a tunnel and widening sections of the M4.
However the Airport Commission’s estimates overlooked the cost of additional buses, road traffic management, and major rail improvements such as an upgraded Great Western Main Line, a new rail link through Staines, and an extension to Crossrail 2 running from Teddington to Heathrow.
Many of these projects were in the Commission’s assumptions – but without any additional funding.
In their February 2015 response, submitted when anti-Heathrow MP Boris Johnson was mayor, TfL said:
“In their short-term assessment, the Commission consistently adopt ‘optimistic’ assumptions for estimating demand, impact and cost. They potentially underestimate airport passenger and staff demand for road and rail by around 25%. Consequently, their appraisal potentially misses out billions of pounds of new transport infrastructure required to accommodate their proposals in the long-term.
“The Commission assume billions of pounds of currently unplanned road and rail upgrades will be implemented before 2030. In spite of their published evidence showing these upgrades are essential to keeping their airport expansion proposals credible, all such costs are excluded from the appraisal.”
“The Commission should conduct a full, long-term surface access assessment of the airport expansion proposals.”
In the same response, TfL also called upon the Commission to clarify whether the multi-billion pound bill for the transport upgrade would be paid by taxpayers or the airport.
It is an issue that still appears to be unresolved. The government has made it clear that it expects aviation expansion promoters to cover any surface access costs, but Heathrow bosses told MPs they have only budgeted £1 billion.
The Airports Commission said (Airports Commission Final Report, para. 8.25) that “Expansion is ‘not a transformative factor’ that would significantly change the scale of these challenges’. i.e. improvements to surface access infrastructure is not Heathrow’s problem.
But Transport for London said: “If non-committee schemes are required for a 3rd runway they need to be identified and their costs included to ensure delivery with a 3rd runway.
Without commitment to additional investment there is a real risk of severe impacts on both airport and non-airport travellers, increased crowding and congestion, and an exacerbation of air quality problems.
Other questions from MPs, and answers by Chris Grayling, in the House of Commons on 25th October, relating to costs to be borne by the taxpayer.
Geoffrey Clifton-Brown (The Cotswolds) (Con)
I am glad to say that I have not lost my wallet, Mr Speaker.
I warmly welcome the Secretary of State’s announcement, but if Heathrow is to meet its emissions targets a large number of people will have to be persuaded to travel by rail rather than car, so will he say something about the western rail link proposals? Will he also consider providing fast rail links between all London’s airports?
Both the western and the southern rail links are part of the schedule for Network Rail’s future projects. Heathrow airport is due to pay part of the cost of those links, since they involve broader issues than this project alone, but as a result of today’s decision their construction will need to be accelerated. Links between airports are not currently being considered, but if the economy of the south-east continues to grow and develop, they may well be considered in the future.
Jonathan Edwards (Carmarthen East and Dinefwr) (PC)
Transport for London has estimated that the cost of associated transport infrastructure to service a third runway at Heathrow would be about £20 billion. Can the Secretary of State give the House a cast-iron guarantee that any public money used to pay for that work would result in full Barnett consequentials? Or is he saying that the routes identified by TfL would be paid for fully by private sources?
It is important to look at the committed outputs. Heathrow airport has committed to an expansion without an increase in the number of motor vehicles using the airport, and to an increase in the number of people accessing the airport by public transport to a level of 55%. That is the objective it has to meet, and it has agreed that it has a financial obligation to get to that point. Some projects are already in train. Crossrail is nearly complete, and the western and southern routes already in Network Rail’s plans will also make a contribution. There is clearly an obligation on the airport to meet those objectives.
Andrew Selous (South West Bedfordshire) (Con)
My right hon. Friend has not said a great deal about the already horrendous congestion on the M25 north and south of Heathrow. Does his Department monitor the extent of the existing traffic jams, which are already really bad? Will anything be done as part of Heathrow’s expansion to try to improve capacity on the M25 so that people can get to and past the airport?
As I indicated earlier, the situation around the south-west of the M25 in particular is a matter for concern. Highways England has plans in place to start to address some of those problems. My experience is that the worst jams occur to the south and the north where four lanes go into three, and I have asked Highways England to look at how we can address that issue, starting with the junctions to the south-west.
John Hayes reply 31.10.2016
In Parliament on 31st October, this is a response from John Hayes, saying Heathrow will indeed have to pay for some infrastructure (but no details)
Heathrow Airport will benefit from Government’s huge committed transport investment programme which will see the delivery of Crossrail, HS2, improvements to the M4 and M25, as well as increased capacity on the Piccadilly Line.
Heathrow Airport Limited will finance the surface access infrastructure required for airport expansion, including re-alignment of the M25, the A4 and A3044, as well as airport and terminal access roads. In addition, it will contribute to the costs of building the proposed new Western Rail Link and Southern Rail Access. This reflects the ambition to have no more people arriving at the airport by private transport than they do today.
While Heathrow try to claim cost of surface access just £2.2 billion, TfL estimates cost of £18.4 billion
Heathrow’s management have claimed that only £1.2bn of public funds would be needed to upgrade local road and rail links, for its 3rd runway, while Heathrow itself would spend a further £1bn, making £2.2bn. The Airports Commission estimated the cost to be around 5.7bn, to include widening the M4 and tunnelling the M25 under the runway. But now TfL has come up with figures showing the total cost would be about £18.4bn, which is hugely more. TfL believes Heathrow and the Commission have substantially underestimated the amount of increased congestion the runway would cause on the roads, and on trains due to 30 million more annual passengers. They also did not take freight into account. The government has said whichever airport might be allowed a runway would have to meet all the costs which arise due to a new runway, and from which the airport would directly benefit. TfL has added the cost of other vital transport infrastructure, such as improving bus services, traffic management measures and alterations to the South West and Great Western Main Lines. TfL says none of the schemes in its £18.4bn figure are already committed, funded or planned. The Campaign for Better Transport said the money would be better spent elsewhere eg. on the Northern Powerhouse.