The government has confirmed that it will delay making a decision on whether to expand Heathrow Airport until at least next summer.
In an announcement that sparked outrage among business groups, the government said that it "accepted the case for airport expansion in the south-east and the Airports Commission’s shortlist of options for expansion" but "more work will be done on environmental impacts".
"The government will undertake a package of further work and we anticipate that it will conclude over the summer," the department for transport said in a statement tonight.
By delaying the decision until the summer, ministers avoid a potential political headache caused by Conservative mayoral candidate Zac Goldsmith, a staunch opponent of Heathrow expansion who pledged to resign from his Richmond Park seat and trigger a by-election if the government backed the Airports Commission.
The Commission, led by RBS chairman Sir Howard Davies, said in July that it backed building a third runway at Heathrow airport. At the time, transport secretary Patrick McLoughlin said he would "come back to parliament in the autumn to provide a clear direction on the government's plans", while Prime Minister David Cameron said he could "guarantee" a "decision will be made by the end of the year".
But tonight the government offered no decision, with McLoughlin saying instead that it is "vitally important we get the decision right so that it will benefit generations to come".
"We will undertake more work on environmental impacts, including air quality, noise and carbon."
A parliamentary committee told the government last week not to give the go-ahead to expanding the west London airport until certain environmental conditions are met.
The committee, which counts Goldsmith among its members, said that the government had a duty to reduce illegal air pollution in the capital – and warned that building a third runway at Heathrow could put Londoners at risk.
Goldsmith said tonight that he is "absolutely delighted" that the government had "heard the arguments, seen sense and will judge the options against an environmental test".
"That is good news for London," Goldsmith added. "We have a massive opportunity now to remove the threat of Heathrow expansion once and for all, and to press for an intelligent approach to London’s connectivity."
Meanwhile, business groups, which have long bemoaned the government's lack of action to increase airport capacity, slammed ministers for their indecision.
"Business leaders will be tearing their hair out at the news that, yet again, a decision on expanding the UK’s airport capacity has been delayed," said Institute of Directors (IoD) director general Simon Walker.
“The government has set the very ambitious target of increasing UK exports to £1 trillion a year by 2020. If they can’t fly to emerging markets to make deals, our members are going to find it very hard to meet this aspiration," Walker added. "At this stage, IoD members care much more about a decision being made, than whether the new runway is built at Heathrow or Gatwick."
Confederation of British Industry (CBI) director-general Carolyn Fairbairn said it was "deeply disappointing" that ministers had delayed a decision on an "issue of critical importance to the future prosperity of the UK".
"We urgently need to increase our runway capacity to spur trade growth, investment and job creation. Just eight new routes to emerging markets could boost our exports by up to £1bn a year.
"But by 2025 – the earliest a new runway would be built – London’s airports could already be operating at full capacity and the longer we wait the further we fall behind the likes of Amsterdam and Paris. If we don’t have a new runway up and running by 2030 the cost to the UK will be as much as £5.3bn a year in lost trade to the BRICs alone.
"It is of course essential that environmental conditions are met. But the Airports Commission spent three years analysing impartial evidence, at a cost of £20 million, and the National Infrastructure Commission was set up just two months ago to take an evidence-based approach to our needs.
"We cannot fall into the habit of simply commissioning new evidence, instead of the government taking the tough decisions needed at the end of the process."
Multiple groups blamed the government for putting politics ahead of taxpayers' interests.
"Businesses will see this as a gutless move by a government that promised a clear decision on a new runway by the end of the year," said British Chambers of Commerce (BCC) director general John Longworth.
"Business will question whether ministers are delaying critical upgrades to our national infrastructure for legitimate reasons, or to satisfy short-term political interests.
EEF chief executive Terry Scuoler accused the government of dithering.
"Industry is fed-up and dismayed by the continued excuses and political dilly dallying," Scuoler said. "The indecision has handed an early Christmas gift to our competitors who recognise the vital importance to their economies of having the room and flexibility to grow air connections to major international gateways."