Airports Commission “buried doubts” over Heathrow growth forecast

Published: 20 August 2015

The Airports Commission has been accused of burying evidence which undermined its decision to back Heathrow expansion over a rival scheme to develop Gatwick.

A cross-party group of South London councils has unearthed a letter by Professor Peter Mackie and Mr Brian Pearce, the commission’s own expert advisors, which questions the reliability of growth forecasts used to justify the recommendation. 

The forecasts, produced by consultants PWC, predicts a third Heathrow runway would deliver up to £147 billion in growth. This figure is used throughout the commission’s final report.

In contrast, the Government’s established approach to economic modelling predicts growth in the region of £33.6 - 54.8billion for Heathrow expansion, versus £27.2 - 47.1billion for Gatwick.

In a letter to the commission Mackie and Pearce warn that the PWC figures include “a high degree of overlap between the direct and wider impacts… double counting … and rely on economic growth and other assumptions which are at the extreme end of the range.”

The experts’ go on to warn that using the £147 billion figure to illustrate Heathrow’s potential benefits could mislead the public and that “qualifiers such as ‘up to’ do not give a flavour of the likely median or mean outcome across the economic scenarios.” 

Mackie and Pearce note the risk of “exaggeration by media” if care is not taken to properly caveat these figures.

The commission’s advisors conclude that “overall, therefore, we counsel caution in attaching significant weight either to the absolute or relative results of the GDP/GVA S-CGE approach (PwC report) within the Economic Case. We would accept that there is some useful indicative material for the Strategic Case but care is required in assessing its robustness and reliability.”

The Mackie Peace letter has been highlighted by a cross party group of South London councils which are investigating the commission’s work amid fears their preferred scheme to expand Gatwick was deliberately undersold. The group includes Croydon, Kingston, Southwark and Wandsworth.

The council point out that the methodology used by PWC is experimental and has never been tested against a live project.

Wandsworth Council leader Ravi Govindia said:

“It’s clear the commission has based its recommendation to expand Heathrow on a grossly exaggerated economic case. Their own expert advisors tore apart the PWC growth forecasts but their evidence was buried and ignored. Sir Howard and his team were hell bent on presenting Heathrow as the best option and refused to let reality get in the way.”

Southwark Council leader Peter John said:

“Gatwick expansion is key to South London’s future and we want to see a fair comparison with Heathrow. Sadly the commission’s economic forecasts are not credible and the final report will go down as crude attempt to mislead Government policy.”

Croydon Council leader Tony Newman said:

“South London councils engaged with the commission in good faith but it’s clear the scales have been weighted against Gatwick expansion. A fair appraisal will point to Gatwick as the best solution and we will continue to make the case for this hugely beneficial project.”

Kingston Council leader Kevin Davis said:

“The commission’s selective use of economic data is deeply concerning and very hard to justify in light of the advice they received from their own appointed experts.  On balance, Gatwick’s expansion would be a catalyst for major, long term investment across South London’s transport network and we can’t let this highly questionable report stop that from happening.”