General News
Below are links to stories of general interest in relation to aviation and airports.
Slough council critical of damage to borough from Heathrow revised plans for runway
Slough Borough Council, which is supportive of a 3rd runway, even though the borough is very close to Heathrow, have now criticised plans in the airport's initial consultation. They say a local school, homes and businesses will have to be demolished under revised plans for the expansion. Slough Borough Council said Pippins School in Colnbrook would be closer to the runway than previously thought. They also fear changes to the M25 would also affect a local trading estate, and lead to increased congestion and pollution. Slough fear that raising the runway above ground level as it crosses the M25 could have "serious impacts" on Pippins School and nearby homes because of "worsening noise and air pollution". The school and nearby houses would be likely to be part of a compulsory purchase order, so Slough needs Heathrow to pay to rebuild the school at another, more suitable, location. The leader of Slough council, James Swindlehurst, said they were objecting to the wider proposals in the hope of "shaping the ideas" Heathrow were producing. Diverting the M25 by 150 metres to the west, he claimed, could involve the loss of homes at Elbow Meadow and buildings on the Galleymead Trading Estate in Colnbrook. In the past, Slough signed a gagging order with Heathrow, preventing it complaining about the runway plans, in order for anticipated benefits from the airport once a runway was built.
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Mayor of London Transport Strategy opposes Heathrow runway, unless there are firm assurances on air pollution, noise and surface access
The Mayor of London has published the Transport Strategy for London, which sets out the Mayor’s policies and proposals to reshape transport in London over the next two decades. The Strategy is firmly opposed to a 3rd Heathrow runway. Its section on Heathrow states: "The demand generated by the current airport combined with local traffic already place considerable strain on the roads and railways serving the airport and contribute to levels of NO2 that are well in exceedance of legal limits. The Mayor considers that, as a result of the additional flights and associated traffic, any expansion at Heathrow would significantly impair London’s ability to meet international air quality obligations in the shortest possible timescale and would contribute to an overall worsening of air quality relative to the situation without expansion. Heathrow already exposes more people to significant aircraft noise than its five main European rivals combined, and the proposed increase in flights cannot avoid many people being newly exposed to significant noise. Moreover, it would be unacceptable if the air quality gains secured by the Mayor and the potential noise improvements as a result of new technologies were not allowed to accrue to local communities to improve public health, but were instead used to enable expansion of Heathrow airport."
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Stop Stansted Expansion asks Government to call in the airport’s expansion plans, or face a JR
Stop Stansted Expansion (SSE) have written a 36-page letter to the Secretary for Housing, Communities and Local Government, Sajiv Javid MP, asking formally for call-in of the application by Stansted for expansion. They include District Council incompetence, bias and a series of statutory planning grounds, as reasons why the airport's expansion plans should be determined nationally - rather than locally by Uttlesford District Council (UDC). SSE has also made clear that refusal by the Secretary of State to call-in the application will trigger an application for Judicial Review in the High Court. SSE is concerned that UDC has taken a blinkered approach to the rules for considering the application in its desire to do the airport's bidding. UDC sees potential gain for itself, even though the planned expansion would be at the expense of not only the Uttlesford villages and market towns it is meant to serve, but communities further afield in Essex, Hertfordshire, Suffolk and Cambridgeshire. SSE's barrister, a planning expert Paul Stinchcombe QC of 39 Essex Chambers has identified that UDC has erred in law in its interpretation of the rules by not recognising the application as a Nationally Significant Infrastructure Project. If the Stansted application was approved, it would mean a 66% increase in passengers and a 44% increase in flights compared to 2017.
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10 years of Terminal 5 lies ‘celebrated’ by Heathrow, whilst proposed sites for runway development shock residents
While Heathrow had a small, rather underwhelming, celebration of 10 years since Terminal 5 opened, residents whose lives would be devastated by a 3rd runway were unimpressed. For them, and thousands of others negatively affected by the airport, T5 just symbolises yet more of Heathrow's broken promises over the years. People were assured at the T5 public inquiry that it would NOT lead to a 3rd runway (that pledge was rapidly reversed). Local campaign Stop Heathrow Expansion (SHE) also points out the hollow promises of jobs from T5 - these never materialised. Local people are shocked at the number and location of sites that could be destroyed as part of Heathrow’s plans for third runway development. These include sites immediately below the M4 motorway could be used to house a new immigration centre and a 20,000-space ‘mega’ car park. The A4 could also be re-routed much closer to West Drayton, which would expose residents and children at Cherry Lane Primary School to even greater air pollution levels. A site close to Wise Lane, West Drayton, could be used for flood storage, whilst land next to Cherry Lane Cemetery could be used for ‘industrial and parking uses’. Jackie Clark-Basten, Chair of SHE, said: "Heathrow’s record of making and delivering promises is poor and cannot be trusted now or ever."
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Heathrow owners urged to stop huge payouts to investors – and strengthen its own finances instead
The Sunday Times says in 2017 Heathrow’s debt totalled £13.7 billion, and it is under pressure to cut its huge dividends for its shareholders, if it was allowed to build a £14bn? (£17bn?) 3rd runway. Ministers and airlines are demanding that Heathrow keeps landing charges down, which would mean the regulator, the CAA, capping dividends. Instead the airport would have to use spare funds for the runway project, and to strengthen its finances. Heathrow paid over £3bn in dividends since its buyout in 2006. Combined with a huge building projects, including two terminals, this has increased its debt to £13.7bn. Last year Heathrow paid more than £560m in interest, plus £525m in dividends, and it approved another £114m payout to shareholders last month. The Sunday Times says that could leave its balance sheet vulnerable if the runway project hits difficulties or the aviation industry suffers a downturn. The runway would almost double the size of Heathrow’s £15.8bn asset base. The shareholders gain from take-off and landing charges, which add about £20 to each passenger’s ticket. A cap by the CAA on Heathrow’s gearing (a measure of debt as a proportion of the value of assets) would ban dividends if borrowings went above a certain level. Heathrow’s gearing is now 87% (far higher than similar businesses) and it wants to increase this ratio up to 93%.
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Sunday Times commentary on Heathrow: the cash machine with an airport attached
The Sunday Times reports that under a complex (perverse) incentive system, Heathrow is encouraged to spend as much as it can on developing the site. Heathrow’s investors earn returns based on the size of its "regulatory asset base" (RAB), under a formula set by the CAA. So the more the airport spends, the more its owners can earn. It gives an example of £74,000 to cut down 3 trees, which is at least 20 times the normal price. These costs of developing the airport are recouped through passenger charges, and also set off against UK tax. The Sunday Times questions the efficiency, governance and transparency of the management of Heathrow. It says the airport is demanding an insurance policy against the risk that the project goes wrong, and wants the CAA to ensure it will be compensated by airlines and passengers if there are unanticipated difficulties (eg. construction delays, or lower than anticipated passenger numbers or revenue). Scrutiny of Heathrow’s spending has been inadequate, there is no audit of the RAB, to show how the figure of £15.8bn for the expansion project is calculated, and Heathrow has not provided a detailed cost breakdown for the runway plans. There are past examples of excessive costs eg. the T2 car park at £61,000 per place, or a smoking shelter at T2 that which was priced at £450,000, but finally cost £1m.
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New premium Heathrow rail link by Elizabeth line (Crossrail) will cost more than Tube but less than Heathrow Express
Transport chiefs have confirmed travellers on the new Crossrail line to Heathrow will pay a premium - but that the fare will be less than half the standard Heathrow Express rate. A peak Crossrail fare from central London to the airport will be £12.10. That is £7 more than the Underground, but a big saving on the £27 standard fare on board Heathrow Express. Passengers travelling from London zone 2 on Crossrail will pay £9.60 single. Heathrow Express currently also offers online single fares of £22 off-peak and £25 peak. Crossrail, which will be officially known as the Elizabeth Line, will take 10 minutes longer than the Heathrow Express’s 15-minute journey - but roughly half the travel time on the Tube from central London. Crossrail services will run to Paddington Station, which the Heathrow Express serves, and will replace the existing Heathrow Connect trains that currently offer a stopping service to the airport from Paddington, from May 2018. Crossrail will open fully in December, linking Reading in the west with Shenfield in Essex and Abbey Wood in Kent. The No 3rd Runway Coalition commented that this is a money grabbing exercise by Heathrow, who own the tunnels which the Elizabeth line will use, to the benefit of its shareholders - and dis-benefit of local people
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True cost of Heathrow 3rd runway to the public purse must be revealed, say MPs
The true cost to the taxpayer of building a 3rd Heathrow runway at Heathrow has not been spelled out to the public, according to a cross-party group of MPs, who warn that domestic flight connections and other transport spending will be jeopardised. Justine Greening and Vince Cable are among those saying the plan would jeopardise spending elsewhere, who are calling on the government to clarify the costs to the public purse. They also want clarity on what benefits the runway would actually bring. In a letter to the Guardian, MPs and councils around Heathrow warn that promised unprofitable domestic flight connections to an expanded Heathrow would only work with state subsidies, that could not be guaranteed in perpetuity. Additionally, more than £10 billion in additional rail and road spending to support a bigger airport would have to be funded by taxpayers, not Heathrow. Having muted her opposition to Heathrow while in the cabinet, Greening, the MP for Putney and a former transport secretary, told the Guardian that Scottish support for the third runway was misplaced. “The SNP need to wake up to the threat that an expanded Heathrow poses to Scotland ... A more expensive Heathrow means fewer connections. People in Scotland won’t understand why the Scottish government think that’s a good idea to support.”
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Letter from MPs & council Leaders: 3rd Heathrow runway would be bad for the UK
A long list of MPs, Council leaders and senior political figures have an open letter, published in the Guardian, on how taxpayers right across the UK, including those living hundreds of miles away from the south-east, would pay for the expansion of Heathrow. They say lots of promises have been made to lots of people in different parts of the country about the extra domestic routes they can expect if a third Heathrow runway is built. It’s all part of a divide-and-rule strategy which glosses over the health impacts of worsening noise and air pollution in south and west London while cheerily talking up the prospects of improved internal connections from an expanded hub airport. They say the Transport Secretary has a duty to spell out the true costs for taxpayers – and to be realistic about the benefits. On more regional flights, the letter points out that it is airlines, not airports, which decide which routes to fly, and no minister can guarantee in perpetuity the taxpayer subsidies that would be needed to keep “unprofitable” routes open. If the airport is "full" within a few years, it is likely the unprofitable domestic routes would be the first to be cut, so airlines can focus on more profitable point-to-point operations. None of today’s “promises” or assurances can be relied on.
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T&E: EU-wide taxes on jet fuel + VAT on plane tickets could help plug EU budget gap & address aviation CO2 impact
Subjecting domestic, intra and extra-EU aviation tickets to even a low rate of VAT would generate huge revenues for governments. Bill Hemmings, from European transport NGO T&E, estimates that taxing aviation fuel for domestic and intra-EU flights at the EU minimum rate of 33 cents/litre set by the Energy Tax Directive could generate about €9.5 billion in additional revenues each year. Abolishing the exemptions and applying a 15% VAT to all passenger transport could generate a further €17 billion. Even the European Commission calls these exemptions subsidies. A common ticket tax on EU departures could generate around €11 billion – or more. The Commission has now proposed reforms to VAT rates across Europe which, if agreed, will become the basis for the long-awaited definitive VAT regime in 2022. But instead of abolishing VAT breaks for airline tickets, the EU plan will treat even frivolous trips like a flight for a weekend break the same, in terms of VAT, as “necessities” such as foodstuffs, or pharmaceutical products. Transport is Europe’s biggest CO2 emitter and journeys by plane form a significant part. One reason in the past why there was no VAT on international air trips was the difficulty in collecting it. However, it is now clear VAT could be charged at the rate of the country the plane departed from, for the whole cost of the ticket.