A few comments, in no particular order...
I regard all 60-year financial forecasts with profound scepticism based upon the track-record of previous examples.
Forecasts are just that. They give an indication of how things would work out under the current circumstances and assumptions so that you can compare different options. Also, don't confuse an inability to control costs with assessing whether a project has delivered the benefits that were predicted. There is no track record established yet as the current Treasury model hasn't been in use for 60 years.
Come on, now ... who are you kidding? Have you asked TfL? GIP? MAG? HACAN? Boris, Zak? YOU personally may disagree with those who oppose LHR R3, but to deny that opposition exists is plain silly
I suspect the original comment was in relation to business-representative organisations such as the Institute of Directors or the CBI as opposed to local politicians and interest groups?
What we do know is that LHR R3 is extraordinarily expensive to deliver here and now
Is it? HAL's construction cost estimate is £11.1bn - with 85% of those costs benchmarked though its supply chain, i.e. the contractors who would most likely be bidding for the work. That is a high level of cost certainty, yet despite this Davies still deemed it appropriate to inflate the costs further through additional risk, contingency and optimism bias allowances (even though these are are effectively the same thing). That £11.1bn buys a new runway, taxiways, apron space, 1.5 terminals plus satellites, a 50% bigger cargo centre and all of the expensive, underground infrastructure needed to connect it all together. On top of that they estimate a further £2.1bn in access infrastructure which includes not just the costs of building the southern rail access, but buying the rolling stock and the costs of operating and maintaining the line. Then there is £3.6bn of "community compensation".
Of this all but £1.2 billion would be privately funded.
Bagso's concerns about a government 'blank cheque' I suspect are somewhat misplaced. I cannot see any circumstance where government would underwrite anything other than the public transport / access infrastructure element of the scheme, as to underwrite the stuff within the airport boundary would probably breach competition regulations.
As a benchmark, the third runway at HKG (which also includes a new terminal, aprons, etc) is currently estimated at £11.76bn (HK$141.5bn).
Thirdly, I do not propose that £10Bn of public money should necessarily be allocated to a single project. A combination of public / private financing spanning several priority projects across a number of regions should produce the best ROI for the taxpayer in terms of employment impact and increasing the UK GDP.
Most of the capital infrastructure projects that I have been involved in over recent years have demonstrated a BCR (Benefit Cost Ratio) of between 2 and 5 - i.e. for every pound spent you get between £2 and £5 back. Even if you take a pessimistic view of taxpayer contribution towards access infrastructure - £10bn - a forecast benefit of £147bn still represents a BCR of over 14, which is significant. Most of the projects listed by SHED, whilst of benefit to the localities in question, would struggle to achieve a BCR of 5, which means you would have to fund just over £29bn of those projects to achieve the same projected level of economic benefit. I'm not saying that they shouldn't be funded, but it explains why projects in the SE tend to secure funding more easily.
It is "we in the North" demand a fair share of the national public transport infrastructure budget before the SE gets yet another sequential turn at the trough
Trouble is, most of the northern core city economies take more out of the public purse than they put in, so it is taxpayers in London and the SE that subsidise our infrastructure investment. A recent report by Centre for Cities ('Mapping Britain's Public Finances') estimated that London contributed £126bn in taxes...Liverpool, Manchester, Leeds, Sheffield combined generated around £38bn. For the same period (2013/14) the GLA received £10.2bn in spend on 'infrastructure, economy and environment' whilst the above-mentioned northern cities received £5.7bn.
Remember that public funds (GBP10Bn?) allocated to LHR R3 cannot then be used elsewhere ... funds can only be allocated once
Not entirely true. Revenue funding can indeed only be spent once, but capital funding - which this would be- is effectively an investment that can generate a return and hence be reinvested elsewhere. A lot of the devolution discussions that are going on hinge on the case of government investment generating the best return through increased growth.
Also, remember that LHR already accounts for getting on one third of the £3bn of APD that flows into the Treasury each year. This may reinforce a view that any public funds spent to enable more passengers to fly through Heathrow would be recouped over time through increased tax revenues.