UK Chancellor Rachel Reeves has said the pursuit of growth “fills” the government’s net zero commitments as she prepares to signal her support for airport expansion in the London region, including at Heathrow.
Speaking at the World Economic Forum in Davos, the chancellor called growth the UK government’s “number one mission”.
Asked what he would do if faced with a choice between economic growth and the UK’s net zero target for 2050, Reeves said: “If it’s mission number one, it’s definitely the most important thing.”
Her comments come as the government considers supporting expansion plans for Luton and Gatwick airports, as well as deciding whether to signal its approval for a controversial third runway at Heathrow.
The possibility of Heathrow expansion threatens to split the cabinet and will force the government to choose between its stated goals of supporting growth and reducing the UK’s carbon emissions.
The chancellor said on Wednesday that the government had already signed off on the expansion of City and Stansted airports, which also serve the UK capital, signaling “this government’s commitment to making Britain a major trading nation”.
Speaking earlier at an event in Davos, Reeves said: “When we say growth is the number one mission of this government, we mean it. That means it trumps other things.”
She is expected to signal in a speech next week that the government favors expanding Gatwick and Luton airports, while reaffirming its support for a third runway at Heathrow.
Heathrow expansion was previously opposed by Prime Minister Sir Keir Starmer and several senior Labor figures.
Some Whitehall officials believe Reeves is trying to jump-start Starmer into publicly endorsing a third track. “That is not my assessment,” said an ally of the prime minister.
Starmer, asked about the issue in the House of Commons on Wednesday, declined to comment on the “speculation”, adding: “We as a government are committed to growth. We are committed to the aviation sector and to our climate obligations. “
Reeves’ support for Heathrow’s third runway could be the political signal the airport’s management needs before deciding whether to proceed with proposals this year – he has been reluctant to revive the scheme without clear political backing.
The chief executive of owner British Airways said on Wednesday he would not support Heathrow expansion unless the government changed the way landing fees are set.
Luis Gallego, CEO of International Airlines Group, said Heathrow’s regulatory model was “not fit for purpose” as he pointed to the high landing fees that the UK’s only hub airport charges on its airlines .
“The government has a growth agenda and we support it. . . but before we talk about expanding or redeveloping Heathrow, the situation at Heathrow has to change,” he told an industry event.
The UK aviation regulator last year forced Heathrow to drop those charges slightly, to £23.73 per passenger by 2025, but both sides remained unhappy.
BA is by far the largest airline at Heathrow thanks to its historic rights to more than 50 per cent of the airport’s landing seats. This has allowed the airline to build a very profitable business, especially on transatlantic flights. Analysts believe any major expansion of Heathrow could hurt BA if its rivals gain more seats at the airport.
Reeves said on Wednesday that any approval of the Heathrow scheme would “take collective cabinet agreement”.
In the last House of Commons vote on a third runway at Heathrow in 2018, seven members of the current cabinet voted against it, including Starmer. The others were Ed Miliband, Steve Reed, Lisa Nandy, Darren Jones, Anneliese Dodds and Hilary Benn.
Miliband, who is now climate change secretary, threatened to resign over the issue during Gordon Brown’s government, while London mayor Sir Sadiq Khan is still opposed.
A spokesman for Khan said this week: “The Mayor has a longstanding opposition to airport expansion around London – linked to the negative impact on air quality, noise and London’s ability to achieve net zero by 2030.”
Critics argue the expansion is incompatible with the UK’s legally binding target of achieving net zero carbon emissions, given that aviation is one of the hardest industries to decarbonise – despite growing hopes for the use of “sustainable aviation fuel”.
Downing Street said this week it still wanted a third runway at Heathrow to meet its four tests on carbon emissions, noise, air quality and growth. Local noise and air pollution issues are considered by experts to be the most difficult to tackle in congested west London.
Meanwhile Reeves, who spent Wednesday meeting bankers and investors in Davos, reiterated her support for aggressive deregulation and the need to pave the way for more construction.
“There is always a reason not to invest, not to build,” she said. “There are bats and newts. It could add something to carbon emissions in 20 years.”
Reeves has sought to reassure businesses that the UK has a clear growth plan after a damaging sell-off in government bonds this month.
She also promised to examine routes for highly skilled workers to come to the UK as the country tries to attract talented individuals in sectors such as AI and life sciences.
