Lord Moylan (Con)

My Lords, the Statement does two things: it announces a review of the Airports National Policy Statement, but gives us little idea in detail as to how it is to be revised, and it tells us that the only two credible proposals for Heathrow’s expansion are still being considered and that the more fanciful proposals have been dismissed. The two are linked because the core purpose of the current ANPS is to facilitate the expansion of Heathrow. In my view, the timing of the Statement is nakedly intended to persuade the OBR that the project is real and deliverable. I wish to test that. First, there is the question of delivery of a revised ANPS, which I must say I think Ministers are rather reckless to embark on. The current Airports National Policy Statement was produced under the premiership of my noble friend Lady May of Maidenhead and expressly favoured the expansion of Heathrow. It survived scrutiny in the High Court and was appealed to the Court of Appeal by environmental groups on no fewer than 17 grounds of challenge and fell on a single one—the legal meaning of the word “policy”. On that arcane question the whole statement fell. By then, the Government were in the hands of Mr Johnson, who was perfectly content with that outcome. But Heathrow took up the cudgels, and the case went to the Supreme Court, which restored the ANPS. The timeline tells its own story. In 2015, the Airports Commission recommended a third runway. In 2018, Parliament approved it by 415 votes to 119, yet only by December 2020 did the Supreme Court clear the legal path for Heathrow to proceed—five years ago. Now, in October 2025, Ministers tell us rather recklessly that the policy is going to be revised and accelerated and we are going to go through the whole process again, with all the potential challenges involved. It is a brave or reckless Government who set out on this course. The Government have an answer to this. In the Statement, the Secretary of State says: “On judicial reviews, we have announced that we will work with the judiciary to cut the amount of time it takes for a review to move through the court system for national policy statements and nationally significant infrastructure projects”. At present, the average time for such reviews stands at roughly 1.4 years. What is the Government’s target? How long do the Government expect it to take for the new airports national policy statement to be approved? Remember, it is the Chancellor’s ambition that this runway should open in 2035, with spades in the ground many years before that, given how much muck has to be moved in order to embrace Heathrow’s plans. I am indeed making the simplifying assumption—it may not be true—that the Heathrow proposal is the one eventually chosen by the Government in November and not the alternative scheme. I may be wrong about that, but I think my assumption is reasonable and, for the moment, simplifying. That gives us five years. Meanwhile, public debate on the whole thing has been minimal, because we have very little information about the proposals. The projected cost of Heathrow expansion stands at £49 billion. The market value of Heathrow Airport, which we know from the last time its shares traded last year, is around £9.5 billion, even though its regulated asset base is closer to £20 billion. People are willing to pay £9.5 billion for something which has a regulated asset base of £20 billion, and they are then proposing that, despite the fact that it is heavily leveraged, much more so than it was 10 years ago when it was discussing this project, we have to reckon with the fact that it wants to spend at least £49 billion—that is the publicly quoted figure; it may be more by now—on a third runway to increase capacity by 50%. My second question is whether this is credibly financeable and whether the Government believe that it is. However, the airlines do not trust Heathrow, because they are expected to pay in advance off the regulated asset base. In fact, they are paying already, because the CAA has approved that some of the costs that Heathrow incurs can already be charged to the airlines and thus to the flying passengers. They think that because Heathrow is incentivised by the current regime to make its expenditure as high as possible, it is untrustworthy. They point to various things, such as a new baggage system completed in 2016, which was priced at £234 million but ended up costing £435 million, and a cargo tunnel with a budget of £44.9 million that ended up with an estimated cost of £197 million. They point, in contrast to Heathrow’s plan to spend £49 billion on a single runway, to terminals at Barcelona, Frankfurt, Madrid and Munich, that all cost half or less when taking the size of the terminals into account; the fact that Changi is expected to create a new terminal for £8 billion; and that New York’s JFK will open its new Terminal 1 in 2026, the centrepiece of a £15 billion transformation that will be completed by 2030. What are the Government going to do about Heathrow and its regulatory structures? They say that they are going to change them. The Statement says: “The Government will therefore work with the Civil Aviation Authority to review the framework for economic regulation for capacity expansion at Heathrow, ensuring the model provides strong incentives for cost-effective delivery”. What has the Civil Aviation Authority, the regulator, been doing for the last 20 years in that case, if it has not been ensuring firm delivery? So my third question is: what are the Government going to do about that? I plan to speak for eight minutes. There is also the matter of noise, which I would like to pursue at some stage, but not at the moment. With that, I will sit down, but I believe that the Government have a lot to do to show that this project is credible, and that they are not contributing to its fast delivery by revising the airports national policy statement at this stage.