I wonder also how any local authority can just change the conditions under which an aircraft operator has run for many years, and at two months notice. Surely this is CAA territory.
It is not a local authority. It is the planning permisson for the LCY extension issued by HM DoT. It has a lots of conditions in it, and one is de facto "you get your shiny new terminal and in exchange, you get us rid off those flying hairdryers aka Avro RJs". These trade-off deals happen all the time when airport expansions are on the table.