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(Sharecast News) - Heathrow airport has said that the construction of its third runway will be delayed for at least 12 months after the Civil Aviation Authority denied its requests to quadruple spending.
Heathrow had asked the Civil Aviation Authority for permission to boost spending from £650.0m to £2.4bn even before having planning consent.
The refusal to grant the spending rise will delay the completion of the runway until 2028 or 2029.
The CAA said that while more runway capacity was needed, and that it was desirable to get a third runway built as soon as practicable, it was concerned that airport passengers could end up bearing the additional costs.
"We believe that more runway capacity at Heathrow will benefit air passengers and cargo owners.Its timely delivery is required to prevent future consumers experiencing higher airfares, reduced choice and lower service quality," said Paul Smith, the group director of consumers and markets at the CAA.
"The sooner a new runway comes into operation, the sooner these benefits can be realised.
"However, we have also been clear that timeliness is not the only factor that is important to consumers. Passengers cannot be expected to bear the risk of Heathrow Airport Limited spending too much in the early phases of development, should planning permission not be granted."
The CAA's consultation said the "best approach in the interest of consumers" was to limit Heathrow construction costs to £1.6bn.
"The CAA's announcement is an important milestone in expanding Heathrow and connecting all of Britain to global growth," a spokesman for Heathrow said.
"We will now review the detail to ensure it will unlock the initial £1.5bn-£2bn of private investment over the next two years at no cost to the taxpayer. Whilst this is a step forward, the CAA has delayed the project timetable by at least 12 months. We now expect to complete the third runway between early 2028 and late 2029."
30 Apr 2024 10:06
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