Boris’s ambitious airport plans grounded

“Boris island” is dead. London mayor Boris Johnson’s ambitious plan to build a new four-runway hub airport in the Thames estuary has been rejected by the Airports Commission, led by Sir Howard Davies, on the grounds that it would cause “huge economic disruption”, face environmental hurdles and come with a £100bn price tag, say Billy Kenber and Alex Ralph in The Times.

The scheme will now not be added to a shortlist for expanding aviation capacity in the southeast, a list that includes two options for expanding Heathrow (costing around £18bn) and a possible second runway at Gatwick (£9bn).

The plan was “brilliant in its own way” and invoked the “visionary spirit of the Victorian age”, says Ben Wright in The Daily Telegraph. But it was also totally impractical; too far from London and home to several protected wildlife habitats.

The real worry is that the “interminable saga about airport capacity” shows no signs of drawing to a close. The final decision lies with the government, and the Davies Report, which will not report back with its final recommendation until next summer, could simply be used to stall for time.

Meanwhile, the increasingly frustrated CBI, the UK’s biggest business lobby, says it needs “spades on the ground by 2020” and argues that the UK badly needs new routes to new markets.

Of course it does, says Boris Johnson, also in The Daily Telegraph. Britain is “haemorrhaging vital connectivity to growth markets”. The expansion of Heathrow has already been ruled out by all three main parties. So it is “mystifying and depressing” that some in Whitehall want to effect a “colossal U-turn”.

A third runway at Heathrow makes no sense. Aside from all the additional pollution it would cause, it could not conceivably be built before 2029. Even then it would lag our rivals.

By 2050 the airport claims it could serve 170 destinations: Paris CDG, Frankfurt and Amsterdam already serve more. Gatwick isn’t the solution, because you don’t get the hub capacity.

Locating an airport in the east will help us address all London’s main challenges, including meeting the surging demand for new houses and jobs. By 2050 the airport would be contributing £92.1bn per year to the UK economy, and finally “Britain would be able to stop our rivals eating our lunch”.

• Stay up to date with MoneyWeek: Follow us on TwitterFacebook and Google+

Paul Hodges: house prices could fall 50% in 'Great Unwinding'

Merryn Somerset Webb interviews Paul Hodges about deflation, the global economy's 'Great Unwinding', and how Britain's house prices could halve.


Which investment platform?

When it comes to buying shares and funds, there are several investment platforms and brokers to choose from. They all offer various fee structures to suit individual investing habits.
Find out which one is best for you.


26 January 1808: Australia's Rum Rebellion

On this day in 1808, Major George Johnson carried out the only forceful takeover of power in Australian history during the Rum Rebellion.