The proposals for a new terminal at Heathrow were given a boost this week when business leaders called on the Government to increase capacity at airports across London.

In a report published on Monday by the London Chamber of Commerce and Industry, they predicted that runway capacity will be exhausted at all London airports within the next ten years.

At the same time, they said that the number of passengers using those airports would increase by 200 per cent between now and 2030.

Simon Sperryn, chief executive of the LCCI, warned the Government to decide now whether London is to continue to be the world's premier aviation hub.

He said: 'London is already suffering from capacity constraints. These will reach a crisis point by 2010 if urgent decisions are not taken to expand both airport runways and terminals.

'London now seriously risks falling behind other European airport hubs ,, Frankfurt, Paris, Amsterdam ,, which are all pressing ahead with ambitious development plans of their own.'

BAA, the owners of Heathrow, welcomed the report, saying that it highlighted the need for additional capacity if the UK is to meet the public's growing demand for air travel.

A spokesman added: 'BAA believes it is vital that these issues are addressed in a balanced and sustainable way.'

The public inquiry in to BAA's proposals for a new Terminal 5 ended last year. Some environmental groups and local authorities opposed further expansion, arguing it would create unnecessary development, traffic chaos and more pollution.

It was the longest public inquiry in history and a decision on whether to build the terminal is not expected until next year at the earliest.

æBritish Airways announced on Tuesday its first losses since privatisation 13 years ago. Underlying pre-tax losses for the 12 months to the end of March were £244æmillion, leading to further speculation of job cuts and compulsory redundancies at the ailing airline.