Might Osborne give green light to Thames airport to keep Boris in City Hall?

Nik Darlington 11.35am

The Times (£) leads this morning with another story abour the Chancellor’s heavily trailed Autumn Statement, in which he will commit the Government to a ‘global hub’ airport in the south-east of England.

Mr Osborne will say that “all options” are under consideration, which raises the possibility of the Mayor of London’s pet project - an entirely new airport in the Thames Estuary - receiving official backing.

Mr Osborne will…use the Government’s new determination to spend on infrastructure to argue that Britain will emerge better equipped to grow. The proposals for a Thames Estuary airport, either on a man-made island or the Isle of Grain in Kent, will not be among 40 projects spelt out today.

But Mr Osborne’s Treasury documents will commit the Government to maintaining a global hub airport in the South East and will state that “all options” will be given full analysis next year. Despite doubts about how such an airport could be funded, it marks the first time that the Treasury has said that the idea would receive a full hearing.

Last year, David Cameron appeared to rule out the option of building a new artificial island - dubbed ‘Boris Island’ - but this would appear to be back on the table. An alternative, built on an existing island, has been sketched out by the architect Lord Foster of Thames Bank. Estimated costs range between £40bn and £50bn.

The first important point to make is that such an airport, if it went ahead, would be a stunning demonstration of British innovation and ambition. Striking an emotional chord should not rule the entire operation, but it matters. At a time when the world’s economic axis is spinning eastwards - though it seems hackneyed to say it - this project would be a sign that Britain at least hadn’t given up the ghost.

The second important consideration is of course cost. Fifty billion pounds is an awful lot of money that Britain, on the surface of things, can ill afford. Ministers already appear determined to push full steam ahead with the embarrassing High Speed 2 railway at a cost of more than £30 billion. Small price to pay to get from London to Manchester a few minutes quicker.

HS2 will gobble up the lion’s share of British domestic infrastructure spending over the next couple of decades. So where, as the Times asks, will the money come from for a new airport? A report published last week by Boris Johnson showed how a new hub airport, properly designed, could begin to pay for itself by attracting inward investment. My expectation is that the private sector would be approached to meet some of the upfront costs, perhaps in the form of special infrastructure bonds, or even with a direct contribution (as with Crossrail).

A new airpot has been criticised by some environmental groups, such as the RSPB, who have concerns for the unique birdlife in the estuary, and by some local MPs. Their defence is as justified as the one I often give myself when opposing HS2. I do not refute it. But I agree with Sir Simon Jenkins, chairman of the National Trust, who wrote in the London Evening Standard that a new airport offers “the least harm for the greatest gain”.

Might there be another, more political reason, why George Osborne is increasingly willing to entertain the Mayor of London’s imagination?

The plans will not be analysed by the Government until next year. That puts off a decision, in all likelihood, until 2013. Building would be unlikely to commence until shortly before the 2015 General Election, if not afterwards. The Thames Estuary Airport Feasibility Review in 2009 suggested it could take until 2030 to complete.

Boris Johnson hopes - indeed, according to most polls, should expect - to be re-elected Mayor of London next year. He insists that he will serve another full four-year term, though gossip persists that he will seek a safe Conservative seat midway through that term in order to be in the House of Commons prior to the election in 2015. The overriding ambition is to be in a position to become Conservative party leader ahead of Mr Osborne.

But how would Boris feel if his grand projet was just getting underway? Boris is ambitious, of course, but he is also, by his own admission, a man with a “healthy dose of sheer egomania”. Having already lent his name to the capital’s bicycles, how could he resist overseeing the foundations being laid for his own island?

Boris Johnson believes passionately in this new airport. By giving it the green light, George Osborne might just manage to keep his rival in City Hall for long enough to keep his nose in front.