The economic boost from a Heathrow third runway could be a tiny fraction of previous estimates, new government analysis shows, while the overall trade-off from the bigger airport could set the UK back by as much £62.5bn.

As ministers promised to speed up expansion of the London airport in the name of economic growth, documents prepared by the Department for Transport said the runway was expected to boost GDP by only up to 0.05% – 90% less than the 0.5% previously stated.

The figures, described as historically bad by one economist, put the arguments for a third runway in fresh doubt. The DfT calculates the net present value of the scheme, even if entirely privately financed, to be between -£23.4bn and £-62.5bn. Net present value is defined by the DfT as the overall social value of expanding Heathrow, compared with not doing it, adding all costs and benefits.

That figure incorporates between £29bn-£42.4bn in positive benefits to passengers – primarily, lower air fares – and wider economic benefits.

But the government’s assessment is that those gains are outweighed by the social and environmental impact of building the runway. Profits at airlines and other airports are expected to fall by around £25bn, according to the appraisal.

The chancellor, Rachel Reeves, has championed rapid expansion of Heathrow in the name of economic growth, which she described as “this government’s top priority” as the consultation for the next stage of legislative was launched on Thursday.

The documents state that “external analysis, commissioned by the DfT, has found that the scheme could add up to 0.05% to GDP in 2056”.

Figures previously cited by the government have been in the range of 0.43%-0.5% growth.

Heathrow said the new figures did not capture all the economic benefits, while a government spokesperson said they were “only part of the picture”.

However, Alex Chapman, head of economic policy at the New Economics Foundation said: “In its desperation for a fraction of a percent of GDP growth, this government has lost its way. They said they were backing Heathrow expansion for economic reasons but their own analysis shows it won’t deliver.

“The results from the department’s impact assessment must be some of the worst in history, and reflect what we’ve been saying for the past year: the economic argument for expansion does not add up.”

A DfT spokesperson said: “Net present value is just one part of the overall picture – crucially, an expanded Heathrow could support over 60,000 new local jobs and deliver £40bn of benefits to the UK.

“This will attract international investment and strengthen Britain’s connectivity, and we have been clear that expansion will be financed by the private sector.”

Heathrow said the DfT appraisal model excluded other ways in which expansion could increase the UK’s economic competitiveness and did not capture the value of UK trade.

It said the Treasury had consistently found that a bigger airport would grow the economy and benefit the UK, and was backed by trade unions, regional airports and businesses.

The documents were published as the government announced the next stage in rapid approval of the third runway, with a consultation before a MPs vote, and ministers promising spades in the ground by 2029.

Heathrow’s proposed 3,500-metre runway would divert the M25 motorway and demolish about 800 homes, to add about 276,000 extra flights a year. The scheme is estimated to cost £33bn, although a recent independent assessment for the Civil Aviation Authority said the project was likely to cost between £32.7bn and £52.4bn.

A DfT health impact assessment separately showed that the third runway could significantly harm the health and wellbeing of up to 3 million people living near Heathrow. The official report said an expanded Heathrow was also likely to worsen access to housing, education, healthcare, open space, and transport, as well as affect water quality and community cohesion.

The Lib Dem transport spokesperson, Olly Glover, said: “Labour can’t show how a Heathrow expansion squares with our climate commitments, or that it can be delivered anywhere near legal noise and air pollution limits.”

“Real leadership delivers economic progress without trashing our climate commitments or steamrolling the communities in the flight path.”

Construction of a third runway at Heathrow is likely to have significant adverse effects on the health and wellbeing of up to 3 million people living nearby, an official report has said, as the government launched the next stage of its rapid airport expansion plan.

An analysis for the Department for Transport has found that expanding London’s hub airport could have “major adverse” impacts on the health of the most local population.

Construction and operation of the third runway will worsen not just noise and air quality, but could also harm access to housing, education, healthcare, open space, and transport, the report bythe consultants Aecom said. Heathrow’s expansion will impact water quality, weaken community identity and cohesion, worsen landscapes and townscapes, and affect climate change mitigation and adaptation, it added.

The impact analysis of the new policy said construction of a third runway would likely be beneficial for jobs, income, education, skills, and training. But the report concluded: “Adverse effects are considered likely with regard to the other determinants which cover environmental and social considerations, and many of these have potential to be significant.”

While the report is expected to help shape measures to mitigate the effect on residents, it says the impacts cannot be fully offset. The DfT was approached for comment.

The disclosure came in supporting documents as the government announced another milestone in expansion, the accelerated publication for consultation of a draft national policy statement backing the third runway.

the transport secretary, Heidi Alexander, said: “Today’s consultation is a positive step towards realising the benefits of a third runway, by giving businesses, communities, and the public the chance to help shape this key project at one of the world’s most successful hub airports.

“We are determined to move quickly and responsibly to set a framework for future expansion at Heathrow that will meet the needs of local people and the country on the key issues of noise, air quality, climate change and economic growth.”

MPs will vote on whether to approve the policy, which is now known as the Heathrow Expansion national policy statement rather than covering airports nationwide.

The previous policy statement was voted through under the Conservatives after the Airports Commission judged that only one runway could be built in south-east England without breaching climate commitments. Labour has since approved expansion at London’s Stansted, Luton and Gatwick airports.

The chancellor, Rachel Reeves, has been a champion of the third runway but is widely expected to leave office if Andy Burnham wins the Makerfield byelection and succeeds Keir Starmer as leader.

She said: “Growth is this government’s top priority, and we are backing the builders to get Britain moving. An expanded Heathrow would support over 60,000 good local jobs and deliver up to £42bn in benefits to the UK – strengthening vital links and improving connectivity across the country.”

Speaking at a conference in London earlier, Reeves said: “Somebody had to bite the bullet … In the last 18 months, we’ve made more progress on Heathrow than the last government made in 14 years. And I am determined that by the time of the next election, there are spades in the ground.”

Heathrow is seeking to build a 3,500-metre runway, which would require the M25 motorway being moved and the compulsory purchase of about 800 homes. The scheme, which is estimated to cost £33bn, would allow the airport to operate up to 756,000 flights with up to 150 million passengers each year.

Heathrow’s chief executive, Thomas Woldbye, said the consultation on the third runway plan represented “something Britain has often found difficult in recent years: progress”.

He added: “Our plan is privately funded by some of the largest investors in the world, widely supported by businesses, trade unions and communities across the country and it’s ready to go after years of scrutiny. We will now focus on securing planning permission and delivering this vital project.”

Paul McGuinness, the chair of the No 3rd Runway Coalition, said the expansion plans were “lurching towards farce” and there would be a “decade of destruction” around the airport in bulldozing houses and land before any runway was built.

He said airlines would be forced to pay ever higher charges and could be out-priced, adding: “No wonder an airline boss has called it HS2 all over again. It seems extraordinary that this government seems committed to repeating those mistakes.”

Celeste Hick, the policy manager at the campaign group Aviation Environment Federation, said the government was rushing policy through “with very little meaningful consultation with the very people” who would pay the price – “communities living under the flight paths and those whose homes will be destroyed or rendered uninhabitable”.

The majority of Great Britain’s major rail operators are now in public ownership, as the Labour government continues its efforts to make the railways “more reliable, affordable and accessible”.

The nationalisation of Govia Thameslink on 31 May represents the eleventh major passenger service to be brought back into public ownership, leaving five to go before the government’s deadline of completing every operator by 2027.

The rollout, which is resulting in an operator being nationalised roughly every three months, is gradually bringing an end to a privatised system that critics argue has been overly fragmented and focused on profit, to the detriment of passenger experience.

Several operators were already under public ownership by the time Labour were elected in 2024, having been nationalised by the Conservatives over financial woes and poor performance.

Meanwhile, Transport for Wales and ScotRail were each nationalised by the Welsh and Scottish devolved governments, in 2021 and 2022 respectively.

However, under the current transport secretary, Heidi Alexander, the Department for Transport (DfT) has accelerated the pace of nationalisation, bringing five operators on to the public books since May 2025: South Western Railway, C2C, Greater Anglia, West Midlands Trains and Govia Thameslink.

The nationalisations come ahead of the establishment of a new state-controlled company called Great British Railways, expected this year, which will manage rail infrastructure and services.

It has been described by the DfT as a “single directing mind” for “bringing track and train together, putting passengers and customers first, [and] rebuilding trust in the railway”.

It will soon manage most of the publicly owned operators in Great Britain, combining them with Network Rail, which owns the tracks, signals and big stations.

However, Great Britain’s trains will remain privately owned.

Industry insiders have expressed cautious optimism about Labour’s plans, highlighting the potential for Great British Railways to achieve more coordination and, in turn, greater efficiency.

However, experts have also warned that nationalisation alone may not be enough to fix all of Britain’s problems with rail, given ballooning costs.

“Irrespective of the ownership changes, the government’s got a major headache with the fact that rail is gobbling up so much public subsidy, and that’s before you get to HS2,” said Stephen Glaister, the emeritus professor of transport and infrastructure at Imperial College London and a former chair of the Office of Rail and Road.

“The government are making promises to make fares even cheaper and services even better, but both will cost more public money.”

The data available on nationalised operators so far offers a mixed picture on performance.

Several have experienced improving train punctuality and a reduction in cancellations but the performance of others has worsened over the past year.

LNER has been one of the most improved – and in June the rail minister, Peter Hendy, described the operator as a “blueprint” for wider renationalisation efforts.

When will the next operators be nationalised?

Labour committed to bringing rail into public ownership in the party’s 2024 election manifesto – claiming it had come up with a way to nationalise trains “without costing taxpayers a penny in compensation”.

Instead of an “all-at-once” approach, nationalising every operator simultaneously and paying off shareholders, the government is running down the clock on existing rail contracts.

The DfT is waiting for each operator’s core contract expiry date, which allows the government to take over without compensating the private companies.

The final operator to expire in this way will be CrossCountry in October 2027 – and this is when the government says it will have completed rail nationalisation in Great Britain.

Until then, the government has set a pace of nationalising one operator in each annual quarter. Chiltern Railways is due next, in September 2026.