Heathrow expansion to mainly benefit wealthy frequent fliers, research finds

UK

Building a third runway at Heathrow will mainly benefit wealthy holidaymakers, not businesses, a new report has found.

Analysis of the last two decades of passenger data collected by the Civil Aviation Authority (CAA) found the main pressures for expanding Heathrow came from international leisure passengers transferring between flights and wealthy outbound tourists, according to a report by aviation tax reform campaign group Fellow Travellers.

The findings counter suggestions by the government and pro-expansion campaigners that opening a third runway at Heathrow would boost the UK economy. They emerge ahead of a key parliamentary vote on Monday that is expected to give the formal go-ahead to Heathrow to begin drawing up detailed plans for the project.

The Government finally approved the plan to build a third runway after years of delays earlier in June, with transport secretary Chris Grayling saying the move showed the Conservatives’ commitment to ”boosting our economy for future generations”.

But, the report entitled Runway for the Few concluded: “the relative importance of business travel has been dramatically overstated in the discourse around airport expansion”.

Demand for business flights has been falling across all the major London airports since 2000, driven by a decrease of one-third in UK business passengers passing through Heathrow in the same period, the analysis found.

A review of Heathrow passenger profiles revealed almost a third of holidaymakers who earned £230,000 or more took at least 12 flights in 2016. Meanwhile, 70 per cent of the poorest five per cent of households across England took no flights at all.

Nearly eight per cent of British leisure passengers at the airport reported owning property abroad, according to surveys collected by the CAA. These passengers flew nearly twice as much as those without second homes overseas, the report said.

Researchers said the share of UK leisure flights being taken by the highest income households is rising, indicating demand pressure at Heathrow stems mainly from wealthier households flying more frequently.

The report also said the third runway was unlikely to benefit the whole of the UK. Only one of the top 20 boroughs for UK leisure passengers at Heathrow lies outside London, the report found. Further, Londoners are around twice as likely to be frequent flyers than people living elsewhere in England.

This disparity is expected to continue, the report found. London and the South East will account for over half of the total national increase in air passengers by 2050 if Heathrow is expanded, but just four per cent of this growth is expected to come from Wales and the North East of England combined, according to the analysis.

Report author Leo Murray told The Independent: “Chris Grayling insists that this is a decision that is being ‘taken in the national interest’, but most of the UK residents using this new runway will be concentrated in London and the South East.

“Our research shows that demand for new runway capacity has nothing to do with business travel to emerging economies, or new domestic routes between London and Scotland. The drive to expand Heathrow is fundamentally about catering to the whims of an elite group of wealthy frequent leisure flyers, many of whom are travelling to second homes in Europe dozens of times a year.

“Because of this, and contrary to popular belief, British airports primarily act as giant wealth extractors, transporting our richest citizens out of the country as often as possible to take their money overseas. When you factor in the climate change costs of Heathrow expansion – as the government have not deliberately not done – this project looks like an absolutely disastrous investment.”

As an alternative to an additional runway in the South East, the report recommends replacing the current Air Passenger Duty with a Frequent Flyer Levy targeting the 15 per cent of the population who take 70 per cent of all flights in the UK.

Labour announced its opposition to the third runway this week, saying it failed to meet four tests on which the party based its position.

Reacting to the new analysis, shadow transport secretary Andy McDonald said: “This powerful report shows that the case for expanding Heathrow airport was based on questionable figures and one of the most expensive lobbying campaigns in history.

“It couldn’t be clearer: the third runway at Heathrow will be for the few, not the many. That’s why it didn’t pass Labour’s four tests.”

Trade unions continue to support the expansion plans, and the Labour Party has allowed its MPs a free vote on the issue, clearing the way for third runway’s approval.

A Department for Transport spokesperson said: “Heathrow is situated in the south-east of England but the benefits of expansion will be felt right throughout the UK, bringing the whole country closer together. 

“The government has made clear that it believes a new north-west runway at Heathrow is the best scheme to deliver the economic and connectivity benefits this country needs. 

“The additional capacity at the airport is also expected to bring a boost of up to £74bn to passengers and the wider economy over the next 60 years, creating tens of thousands of additional local jobs and apprenticeships.”

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