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Heathrow can sue if expansion goes wrong, minister reveals

Heathrow can sue if expansion goes wrong, minister reveals

By Dan O’Donoghue, Press Association Political Staff

Heathrow Airport will be able to recover “potentially billions of pounds of costs” if the third runway expansion goes wrong, MPs have heard.

The decision to press ahead with expansion plan was announced on Tuesday after years of wrangling and delay.

Former transport secretary Justine Greening, who secured an urgent Commons question on the issue, raised concern that a clause in the Department for Transport’s agreement with Heathrow Airport Limited could mean the taxpayer footing the bill “when things go wrong”.

Ms Greening quoted the document which sets out that Heathrow Airport Limited reserves the right “to pursue any and all legal and equitable remedies” in the event of an alternative scheme being preferred by the Secretary of State or the withdrawal of the Government’s support.

She said: “It paves the way for Heathrow recovering costs off the taxpayer when things go wrong, and as the Secretary of State himself said on Tuesday there are circumstances in which the runway could be built but not then used.

“Why was this term agreed to in the first place, Heathrow is private company it should therefore accept the risks?

“Is he confident that if we do end, as I suspect, in a situation where Heathrow expansion goes wrong, this company does not pursue the Government and taxpayers for potentially billions of pounds of costs?”

Transport Minister Jesse Norman told MPs that the phrasing was “standard” and that the Government had taken advice from “distinguished leading counsel”.

He did add however that there “might be some circumstance” in which Heathrow could take legal action – to cries of disbelief from the Labour benches.

He said: “There might be some circumstance with some future government, possibly of a different political persuasion, which did create a contingent liability.

“They would then be under an obligation to present that to Parliament in the normal way and Heathrow Airport might in the exercise of its legal rights have the ability to sue them in some respect.”

Shadow transport minister Karl Turner however described the statement as “a devastating revelation”.

He said: “It seems to be a devastating revelation and it’s simply beyond belief that when this bombshell lands the Secretary of State is not here to respond.

He added: “Isn’t it the case that the Government has boxed itself into a corner by committing HAL to a risk-free investment and exposed itself to either massive cost recovery on the part of HAL or alternatively a crushing litigation before the decision has even been taken?”

Mr Norman responded saying it was the “dampest of damp squibs” and repeated that “no indemnification has been given”.

The announcement to back the expansion came after the independent Airports Commission concluded in 2015 that a new north-west runway for Heathrow was the best option for delivering extra airport capacity – a decision endorsed by ministers in October 2016.

Pic by Yui Mok/PA Wire

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