Government gives green light to £344m London City Airport expansion

The government has given the go-ahead for a brand new £344 million expansion programme at London City Airport. According to the airport, the project will create 1,600 airport jobs, 500 construction jobs and potentially add £1.5 billion to the UK economy by 2025. 

The importance of the programme to a government keen to show ongoing infrastructure development at a time of economic uncertainty was underlined by the fact that three ministers made the announcement - chancellor Philip Hammond, transport secretary Chris Grayling and communities secretary Sajid Javid.

The three ministers announced the approved plans for an extended terminal, new aircraft taxiway and parking spaces for planes in one of the capital’s fastest growing airports. As well as improving passengers’ journeys, the new plans will increase connections within the UK and Europe and support business opportunities and investment.

There will be new space for planes to taxi to and from the runway, increasing capacity, and new stands for planes to allow bigger, more modern planes to use the airport. This will mean more flights at peak times, with bigger, newer and, the government says, quieter planes. The extended terminal will give the airport the space it needs to cope with the increase in passengers and services.

London City Airport will also make a number of investments in transport links around the airport, including funding the cost of additional DLR rolling stock (£2.6 million), investing in a bus and taxi access scheme and improving walking and cycle routes to the airport.

Commenting on the announcement, the chancellor Philip Hammond, said: “London City Airport’s ambitious growth plans will boost international connections, strengthening the City of London’s links to destinations across the world, and send a clear signal that Britain is open for business. Making it easier to visit and do business in the City of London will help drive forward our economy and further strengthen the city’s status as the world’s leading financial centre.

“This is a real vote of confidence in the resilience of our economy, creating over a thousand new jobs.”

Transport secretary Chris Grayling hailed the announcement as “fantastic news for London and Britain as a whole”. He said that he was determined to invest in UK infrastructure in order to boost investment and create opportunities.

“These new plans for London City Airport will deliver jobs and business in the capital and more widely. Companies across the UK will be able to bid for construction and procurement contracts worth £294 million, meaning the benefits will be felt up and down the country,” said Hammond.

Amanda Clack, partner at EY and head of infrastructure advisory, commented: "The London City Airport announcement will be a shot in the arm for confidence in investment in UK infrastructure. Post-Brexit, it is more important for the UK to remain competitive in a global market and world-class infrastructure can be a key differentiator. 

“Looking at London, in particular, infrastructure can deliver wider economic benefits, which will be critical to the capital’s future. Upgrades to DLR rolling stock and upgrades to the local transport network will be key in meeting future capacity demands and mitigating the impact on the local community to support sustainable growth,” said Clack.

Given the increase in capacity at London City, a generous compensation package will also be provided by the airport to support local residents affected by the increase in air traffic.