Luton Airport has welcomed Chancellor Rachel Reeves’ growth speech and called on the Secretary of State for Transport to formalise the government’s approval of their expansion plans, saying it will provide 11,000 jobs, generate an additional £1.5 billion in the economy each year and provide funds for investment in public services.
In a speech delivered yesterday ( January 29, 2025), the head of the UK Treasury outlined the government’s renewed focus on economic growth through major infrastructure projects.
Luton Airport has proposed increasing its passenger capacity from 18 million to 32 million annually by building additional terminals and upgrading infrastructure. This is projected to inject £1.5 billion into the local economy and improve transport links in the region. However, a decision was delayed for a third time in December and pushed back to April 3, 2025.
While Ms Reeves’ speech did not directly address that project, a key announcement was the government’s backing for the controversial third runway at Heathrow Airport, which suggested a favourable stance on airport expansions.
Given the government’s pro-growth strategy and openness to airport development, it could pave the way for Luton’s expansion plans and for further economic benefits to the area.
Since 2013, the airport has generated more than £500million in concession fees for Luton Council which has been used to fund frontline public services and support local community groups through charitable giving.
The airport’s growth plans balance the significant economic growth opportunity for the UK with some of the most robust, far-reaching and comprehensive commitments to sustainability ever introduced at a UK airport, including a legally binding framework with limits on noise, carbon emissions, air quality and surface access impacts under a ‘Green Controlled Growth’ strategy.
If approved, the plans would support a further 11,000 new jobs and increase the airport’s significant contribution to local and national economic growth. It would also improve transport links across the UK, increase consumer choice, and drive more competition between airlines.
Alberto Martin, Chief Executive Officer, London Luton Airport said: “We welcome the Chancellor’s growth speech today and now call on the Secretary of State for Transport to formalise the government’s approval of Luton’s expansion plans.
“Today, every £1 spent by passengers at the airport, allows the local authority to invest 53p directly into local community causes – 20 times more than any other UK airport. Luton is now at a tipping point with a generational opportunity to boost investment in public services further, which the airport’s growth will deliver.
“We are now focused on finalising our longer-term partnership with the council to make this expansion, the government’s growth policy, and Luton’s local ambition for sustainable economic growth a reality.”
Rodrigo Marabini Ruiz, Director of International Subsidiaries at Aena, the world’s largest airport operator, said: “The airport contributes a significant proportion of Luton Council’s budget each year, and we are proud to operate one of the UK’s most community-driven infrastructure assets that is focused on making a positive impact for that purpose.
“Increasing the airport’s capacity by over 70 per cent sustainably will require an investment and operating partner with specialist skills and expertise, and as the world’s largest airport operators, we are ready to support Luton’s next chapter.”
Graeme Ferguson, Head of Airports at leading infrastructure investment manager InfraBridge, said: “We are proud that our leading public-private partnership with Luton Council has driven exceptional outcomes for Luton and all users of LLA, including our airline partners who will benefit from enhanced efficiency and increased capacity under these expansion plans.
“InfraBridge and Aena are committed to building on our success, providing the expertise and capital required to deliver new infrastructure and achieve an ambitious passenger target that closely aligns with the government’s growth mission.”
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