Chancellor hints at support for third runway at Heathrow

The Chancellor has hinted that the government will support the construction of a third runway at Heathrow Airport, stating that "sustainable aviation and economic growth go hand in hand." She emphasized that developing sustainable aviation helps reduce carbon emissions while also promoting economic development.

Shadow Chancellor Rachel Reeves, in an interview with the BBC, said she would not comment on "speculation," and that the government would announce its plans in due course. However, she pointed out that a third runway at Heathrow "would mean planes could land directly rather than circling over London," and that sustainable fuels are changing the carbon footprint of flying.

Reeves is expected to announce support for airport expansion in a major speech next week on plans to boost the economy. The government has previously stated its desire to speed up approvals for housing and commercial developments near train stations and to reduce environmental impact assessments. In an interview on the BBC's "Sunday with Laura Kuenssberg," the Chancellor's optimism about the economy was higher than in recent months, after the government had repeatedly warned about public finances.

Reeves stated that she does not believe "low growth is our destiny" and pledged to go "further and faster" to remove barriers to investment. When asked whether she would also announce news about Heathrow next week, she did not directly answer, instead saying that the government had already approved expansions at London City and Stansted airports. "This will be good for investment and trade in our country, and also for families who want to enjoy affordable holidays," she said.

London Mayor Sadiq Khan criticized the expansion of Heathrow, saying it would have a devastating impact on air quality, noise, and the capital's ability to achieve net-zero emissions. In response, Reeves said that "a lot has changed in the aviation sector," including investment in sustainable fuels and electric planes. She added, "I believe that clean energy and reducing carbon emissions are good for economic growth."

The Labour Party has made boosting economic growth a central mission for the government, pledging to raise living standards before the next general election and achieve the highest sustained economic growth in the G7. However, economic growth was zero between July and September, and the latest monthly figures for November showed only a small increase. The push for economic growth and promises to reduce regulation have raised questions among some about whether environmental concerns are being prioritized.

A former Labour frontbencher suggested the Chancellor might appear "desperate" in her pursuit of growth. The expansion of Heathrow has long been opposed by environmental groups, some Labour MPs, and residents living near the airport. Labour leader Keir Starmer and seven cabinet ministers, including Energy Secretary Ed Miliband and Environment Secretary Steve Reed, voted against the proposal to build a third runway when Labour was in opposition in 2018.

Last week, Miliband said he would not resign if the government supported the construction of a third runway, insisting that clean energy was "absolutely complementary" to the government's growth mission. But London Mayor Khan said his opposition to a third runway had not changed, and that he would support legal action if the government backed the proposal. There is currently no application for a third runway at Heathrow, and last December, the airport's chief executive said the company needed "clear guidance" from the government by the end of 2025 in order to move forward with the plan.

Reeves also hinted that the government would consider joining arrangements between the EU and its neighbors aimed at promoting tariff-free trade. Last week, the EU's new trade chief, Maroš Šefčovič, told the BBC that he was willing to allow the UK to join the Pan-Euro-Mediterranean Convention (PEM) in a post-Brexit "reset." The Chancellor told Sky News that the government was "happy to look at these different proposals" because the current arrangements were "not good enough for businesses."