Ministers to land bankers for Heathrow expansion role

Ministers are lining up advisers to assess the affordability of Heathrow's £49bn third runway plan amid growing expectations that it will miss its 2035 completion deadline by four years.

Sky News has learnt that the Department for Transport (DfT) has called in investment bankers to pitch for a role scrutinising one of Britain's most important infrastructure projects.

According to a document circulated to prospective advisers, the government "requires independent financial and commercial advice to assess whether the scheme can be delivered affordably and effectively while protecting passengers and taxpayers".

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"Advice is also needed on financeability, delivery models, risk allocation and government's exposure to costs as the project develops."

Insiders said an adviser was expected to be formally appointed in the coming weeks.

The document refers to a 2035 completion date for the expansion plan - which the Sunday Times said last month had already been pushed back to 2039.

Alongside HS2, Heathrow's proposed third runway, which the airport and its supporters say is essential to Britain's future economic growth, has become the most controversial infrastructure project in the country.

There remains uncertainty about whether Andy Burnham, the prime minister, supports it after he refused to give a clear answer on the issue.

"I think principally, it's a matter for London and Londoners," he told the BBC 10 days ago.

Heathrow's expansion has been treated as a political football for decades, although there appeared to be a clearer path to the project proceeding last year when Rachel Reeves, the then chancellor announced the government's formal support for it.

A third runway at the airport could support 100,000 new jobs, according to estimates, although airlines have raised concerns that the eventual cost has been drastically underestimated and warned passengers face huge hikes in fares to cover the costs.

Heathrow says the runway itself will cost approximately £33bn, with associated infrastructure improvements taking the overall budget to £49bn.

However, a presentation prepared by the airline-funded Heathrow Reimagined and seen by Sky News earlier this year said the overall budget for Heathrow's expansion and operating expenditure could soar beyond £100bn.

Heathrow, the world's busiest two-runway airport, disputes that estimate.

If the plan goes ahead, the number of flights taking off and landing at Heathrow, which is capped at 480,000 a year, could rise to 720,000.

A DfT spokesperson said: "We are procuring an expert financial adviser to support the government in moving forward with a framework for Heathrow expansion that delivers a third runway affordably.

"Heathrow expansion has the potential to deliver around £40bn in economic benefits across the UK.

"We are currently reviewing the responses received to the recent consultation on the policy framework underpinning expansion, and considering the appropriate next steps."

A further decision is expected from the government before the end of the year.

Heathrow, which is owned by a consortium of pension funds and overseas sovereign investors, wants the expansion project to gain full planning permission by 2029.

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