Stand off over Stansted

The Prime Minister favours a new runway in Essex, but airlines say it's Heathrow or bust for Britain's aviation industry. Jason Nissé reports

If the Government sanctions a new runway at London Stansted, not only will it never be built, but the decision itself will blight Britain's aviation industry.

The stark warning comes from the UK's two largest airlines, British Airways and Virgin Atlantic, which are desperately lobbying the Government to allow a new runway to be built at Heathrow.

Alistair Darling, the Secretary of State for Transport, is due to announce plans for at least one new runway in the south-east of England in an aviation White Paper next month.

The Cabinet is said to be split between whether to allow the first new runway to be built at Stansted in Essex or at the more popular Heathrow. Gordon Brown is said to favour the Heathrow option while Tony Blair believes Stansted is more acceptable politically.

BAA, which owns both airports, has not said which it prefers, though it concedes that the Heathrow scheme makes more sense economically. The Stansted plan, though, faces opposition from not only the airlines, but business and trade unions.

Andrew Cahn, the director of government affairs at British Airways, said: "A runway at Stansted would not get built. Nobody wants it. Nobody would pay for it. The tarmac wouldn't even get laid."

BAA has admitted the only way to make a new runway at Stansted viable would be to cross-subsidise it, probably by forcing airlines to move flights from Heathrow.

The airlines have vowed to take the Government to court to prevent this cross-subsidy.

"The prospect of airlines funding the development of an airport that we do not want is beyond the pale," said a spokesman for Virgin Atlantic.

Mr Cahn said that failing to build a new runway at Heathrow would send business to alternative European hubs at Charles de Gaulle in Paris and Schiphol in Amsterdam.

"The UK long-haul aviation industry would go into terminal decline. Charles de Gaulle will overtake Heath- row in the next five to six years," he said.

Digby Jones, the director- general of the Confederation of British Industry, is also throwing his weight behind the Heathrow campaign. "There should be built, as quickly as possible, a new runway at Heathrow," he said.

The CBI believes the South- east needs as many as three new runways, at Heathrow, Gatwick and, only then, Stansted.