London City Airport given go-ahead for £344m expansion programme

London City Airport £344m expansion programme has been given the green light by government, potentially adding £1.5 billion to the UK economy by 2025.

Chancellor Philip Hammond, Transport Secretary Chris Grayling and Communities Secretary Sajid Javid have announced the approval of a brand new £344 million expansion programme at London City Airport.

Commenting on the approval, Chancellor of the Exchequer, 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.”

Artist impression of London City Airport expansion programme

The City Airport Development Programme (CADP) is a £344 million privately funded investment which includes plans for 7 new aircraft stands, a parallel taxiway and passenger terminal extension. The airport believes CADP will allow it to handle 6.5 million passengers by 2025, create 1,600 airport jobs, together with 500 construction jobs, and inject £1.5 billion each year into the economy.

7 new aircraft stands, a parallel taxiway and passenger terminal extension at London City Airport

There will be new space for planes to taxi to and from the runway, so more planes can use it, 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 quieter planes. An extended terminal will give the airport the space it needs to cope with increased passenger numbers and services.

Transport Secretary Chris Grayling said: “This is fantastic news for London and Britain as a whole. I am determined to invest in the infrastructure this country needs, to help people get around more easily, boost investment and create opportunities.

“London City Airport is an engine for growth in the City, serving the community in which it operates and providing a vital link to our regional airports and the rest of the country.

“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.”

CADP also includes provisions for a number of investments in transport links around London City Airport.  This will include funding for additional DLR rolling stock at an estimated cost of £2.6 million, investment in a bus and taxi access scheme and improving walking and cycle routes to the airport.

Responding to the announcement, Declan Collier, CEO of London City Airport said: “Today, the new Government has shown it is ready to act in the best interests of the British economy.  Expansion at London City Airport will create more than 2,000 new jobs in East London, add much-needed aviation capacity in the South East, and generate an additional £750m per year for the UK economy.  As the airport serving by far the highest proportion of business travellers in the UK (52%), who do some £11bn of trade in Europe annually, today the Government has sent a strong message that London and the UK are very much open for business.  I welcome the decision and look forward to delivering new airport capacity for the South East by 2019.”

Stewart Wingate, Gatwick Airport CEO, gave his reaction to expansion approval at London City: “The expansion of City Airport is great news for the national economy and will generate welcome competition between the network of airports serving the South East – delivering more choice and cheaper fares for consumers.

“Today’s quick decision demonstrates what can be done when an expansion scheme that is deliverable is chosen.  The South East however desperately needs even more airport capacity and only Gatwick can deliver it because our plans are simple, low risk and are better for the environment.  Unlike Heathrow, Gatwick expansion would also be entirely privately financed and does not need a £5 billion public subsidy to put the M25 into tunnels or pay for new rail links.”

A Heathrow spokesperson added: “It’s great news that London City Airport has been granted permission to expand. The announcement signals the Government is committed to ensuring Britain has the 21^st century infrastructure it needs to compete in the world, and we look forward to a final Government decision on the Airports Commission’s clear recommendation for a third runway at Heathrow.”