A third runway at Heathrow airport could be back on the agenda after the Chancellor unveiled plans for a major Government review of airline capacity around London.
George Osborne revealed Justine Greening, the Transport Secretary, has been told to “set out government thinking” on new runways and air terminals in the summer.
Declaring that “this country must confront the lack of airport capacity in the South East of England”, the Chancellor added: “We cannot cut ourselves off from the fastest growing cities in the world.”
Mr Osborne’s intervention follows strong criticism of the Government by the likes of the CBI which has accused ministers of burying their heads on the issue of airport capacity.
The Chancellor’s comments come in a week in which Heathrow airport itself embarked on an expensive media campaign catchphrased: “The road to economic recovery isn’t a road. It’s a flightpath.”
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The adverts claimed the world’s fastest growing economies are doing “more business with France, Germany and Holland because they have the connections we lack”.
The Prime Minister has previously led the opposition to the building of a third runway at Heathrow on environmental grounds. David Cameron has instead tacitly encouraged Boris Johnson, the Mayor of London, to suggest plans for a wholly new airport in the Thames estuary.
However, that proposed airport – tagged Boris Island – is seen as prohibitively expensive and would take years to deliver.
Mr Osborne also committed to backing Network Rail’s plans to rejuvenate rail travel in the North of England. The Chancellor gave the go-ahead for the upgrade of lines between Manchester and Sheffields, Bradford and Preston.
He also said Manchester would get its own £1.2 billion “growth-enhancing infrastructure” pot of money as part of the devolving of spending powers to city mayors.
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Of leaked plans to bring in private investment on to the nation’s motorways and major truck roads, Mr Osborne said: “We’re now working with a dozen of the largest pension schemes specifically on that.”