Airport capacity decision deferred until at least October

In the latest sign that political uncertainty following last week’s Brexit vote will have consequences for the infrastructure sector, transport secretary Patrick McLoughlin has announced that there will be no announcement on airport expansion until October at the earliest.

Speaking in Parliament this morning, McLoughlin said that "given recent events" he "cannot see any announcement" on airport expansion until the new Conservative Party leader is elected. The announcement on increased runway capacity for the south east was due to be made in July but that is no longer going to happen after McLoughlin told MPs that "clearly any announcement has to be made when the House is in session," but that will not happen until "at least October".

The announcement will be greeted with dismay by many in the infrastructure sector, particularly as it comes only 36 hours after McLoughlin pledged that infrastructure was more important than ever post-Brexit. Heathrow and Gatwick airport are now set to endure more uncertainty about their respective development plans as a result. 

Speaking to parliament, Conservative MP Crispin Blunt said that the Department for Transport should have spoken to Boris Johnson and Theresa May to seek assurances on airport expansion. "It is inconceivable that either the home secretary or former mayor of London would put their constituency interest ahead of the national interest," Blunt said.

"Had he (McLoughlin) sought an assurance from the mayor of London I'm sure he would have received it." Blunt said that extending the uncertainty around the airport announcement is having a negative impact on his constituents who live near Gatwick airport.

McLoughlin said that he was sorry and disappointed about the announcement but "given the parliamentary timetable I just don't see it being possible to come to the House with a decision and organise a vote before the summer recess".

A delay on announcing the details of airport expansion is bound to raise fears in the industry about the future of other planned major infrastructure projects including the new nuclear power plant at Hinkley and the whole Northern Powerhouse agenda which has been heavily promoted by the chancellor George Osborne, who is highly likely not to be in post come the autumn.

Commenting on the latest developments, ACE chief executive Nelson Ogunshakin said: “This is a disappointing announcement, particularly coming so soon after the transport secretary said that investment in infrastructure is now even more important. Infrastructure remains a key sector for the UK economy and the referendum result does not change that fact. It is crucial that our industry continues to make the point that current infrastructure plans must be maintained in order to safeguard the economy and give confidence to the markets and the industry.”