This memo evaluates three policy alternatives to address the projected capacity constraints at Sydney's Kingsford-Smith Airport by 2029: 1) maintaining the status quo, 2) removing the regulatory cap on hourly flight movements, or 3) building a new secondary airport at Badgery's Creek. A cost-benefit analysis over 50 years was conducted. It found building a new airport at Badgery's Creek would provide an additional $5.22 billion in net social benefits and is the preferred option. Maintaining the status quo would result in serious delays by 2022. Removing the flight cap is not socially efficient according to the analysis.

1. MEMO
To: Sam Haddad, Director-General, NSW Planning and Infrastructure
From: Jonathon Flegg, Strategy and Planning Unit, NSW Planning and Infrastructure
Email: j.c.flegg@nus.edu.sg
Date: 20-Jun-2011
Re: Evaluating a Proposed Second International Airport for Sydney
Executive Summary
Sydney’s Kingsford-Smith Airport is Australia’s major international and domestic air transport
hub. In 2008-09 there were 32.7 million passengers moved through the airport, including 43.5%
of all international arrivals into Australia. As a result there are major concerns that the current
airport will reach capacity within the next 10 years. Capacity is current limited by a physical lack
of space, federal regulation limited traffic volume, and a lack of land-based transport substitutes.
The Policy and Strategy Unit (PSU) has analyzed whether Sydney should: (1) maintain the
status quo; (2) seek the removal of the regulatory constraints limiting traffic at the current
airport; or (3) build a new secondary airport at the most promising site of Badgery’s Creek in

2. Western Sydney. Our cost-benefit analysis over the next 50 years shows building a new second
airport at Badgery’s Creek could be completed between 2017 and 2018 and is estimated to
provide additional net social benefits to Australians of A$5.22 billion over the next half century.
The major economic benefits of such a policy decision are from economic stimulus to Western
Sydney and through time savings associated with relieving the capacity constraints at
Kingsford-Smith Airport. The most significant costs associated with the proposed project are the
loss of the alternative use of the site and the costs of congestion and aircraft noise affecting
local residents. The result is robust for any social discount rate below 10.0%. Removing the
regulatory cap on traffic through Kingsford-Smith is not a socially efficient policy solution
according to our analysis.
The political situation is complicated, polarized and salient to voters. The PSU analysis
suggests that with the right strategy a number of key stakeholders could move closer to a
position of support for such an infrastructure project. Passengers and residents of Western
Sydney are both large and politically-significant groups that could mobilized if given the right
inducements, such as better access to public transport.
Problem Statement
In 2007 31.9 million passengers moved through Kingsford-Smith Airport, and this is forecasted
to increase to 78.9 million by 20291. The capacity of the current site is quite limited and there
are major concerns that the current airport is reaching capacity. Occupying a site within only 10
kilometres of the Central Business District, it is surrounded by relatively dense residential
development, the Port of Sydney, and Botany Bay (see Figure 1). The last major capacity
increase was the parallel, or “third”, runway that was completed on reclaimed land in Botany
Bay in 1994. Booz and Company consultants recently reported that by 2020 if the status quo is
maintained bad weather days could result in flight delays of up to 5 hours2.
Is developing a new secondary airport the most appropriate policy response to the projected
increase in demand for air travel services? On the demand-side, air travel continues to grow in
1
SAC. 2009. “Aviation Activity Forecasts 2009”. In Sydney Airport Master Plan 2009 Retrieved from:
http://sydneyairport.com.au/ .
2 th
Bennett, A. and V. Morello. 5 April 2011. “Fed, NSW govts at odds over second airport”. The Age.
Retrieved from: htttp://www.theage.com.au/ .

3. Sydney because of both growth in the city’s population3, and because the deregulation of the
airline industry in Australia between 1990-95 has caused strong domestic competition to
emerge on key routes. For example, the Sydney – Melbourne route has now emerged as the
fourth most travelled air corridor in the world, and Sydney – Brisbane is twelfth4. The supply-side
problem is an issue of capacity constraint:
 Physical constraint. The physical limits of the current infrastructure and the difficulty of
building future capacity at the current site.
 Regulatory constraint. In 1995 the Federal Government responded to noise concerns by
passing the Sydney Airport Curfew Act which capped flights to a maximum of 80 flights
per hour and an aircraft curfew between 2300 and 0600 daily.
 Substitution constraint. Unlike many other developed economies, Australia lacks a fast
land transport network between its disparate major population centres.
Figure 1: Site of Sydney Airport and Surrounding Suburbs
Addressing any of these supply-side constraints requires a public policy intervention. While the
Federal Government privatized major airports in 1994, as major infrastructure critical to the
Australian economy they remain heavily regulated by the Australian Competition and Consumer
3
Sydney’s population of 4.6 million people consists 20% of the nation’s total and it is growing
rapidly, by around 85,400 in the year 2008-2009.
4
Wikipedia. 2011. “World’s Busiest Passenger Air Routes”. Retrieved from: http://en.wikipedia.org/ .

4. Commission (ACCC). Price regulation only ended in 2001. Operational regulations are also
overseen by the Civil Aviation Authority. The decision to build a second airport would require the
support of the Federal Government and the NSW Minister for Planning. State Government
transport and rail authorities would also be required to provide transport links to the site. A
decision to relax the regulatory constraint could be achieved through an Act of Federal
Parliament without the involvement of NSW Government. The development of a major land-
based mass transportation alternative would require the involvement of a number of
governmental actors.
As a single piece of infrastructure Sydney Airport has national economic significance. Sydney is
Australia’s major commercial centre and is the most-travelled gateway to the nation. Every year
Sydney Airport facilitates A$8 billion of indirect economic activity, which is roughly 2% of
national GDP5. Of all international arrivals, 43.5% arrive through Sydney Airport alone.
Moreover as traffic through the Airport reaches the 80 per hour limit, delays permeate
throughout entire domestic network, making this an issue of national economic significance.
The constraint issue must be resolved in the long-term before Kingsford-Smith Airport reaches
its capacity. If the Australian and NSW Government can agree to a course of action, tendering
for a construction contract could commence in 2012, with the majority of construction being
completed between 2015 and 2016. A new airport could be operational at the earliest by 2017.
On current projections maintaining the status quo will result in serious failure to cope with air
traffic volumes between 2019 and 2022.
Policy Alternatives
Each of the three constraints to the supply suggest an alternative policy response, and each has
their proponents. Possible policy interventions to this problem include:
1. maintaining the status quo and relying on the current infrastructure to accommodate the
increased demand;
2. changing the legislation to permit either the removal of the curfew or allow more than 80
flights an hour to land;
3. building a new secondary airport at the Badgery’s Creek’s site in Western Sydney;
4. building or developing at a site outside the Sydney Basin;
5
SAC. 2009. “Aviation Activity Forecasts 2009”. In Sydney Airport Master Plan 2009 Retrieved from:
http://sydneyairport.com.au/ .

5. 5. developing the current site to permit more flight-movements; or finally
6. the development of a high-speed rail network linking the major Eastern seaboard
population centres.
Sydney Airport Corporation advocates removing the regulatory cap on traffic through their
facility. In a recent submission to the Productivity Commission SAC argued6:
The arbitrary limit of 80 aircraft movements in an hour is below the demonstrated capabilities of
Sydney Airport and artificially limits the effective capacity of the airport. As a consequence:
 The theoretical long term capacity of the airport is limited
 Strategic slot hoarding by airlines in the morning and evening peaks results/occurs
 Capacity constraints increase in morning and evening peaks, when the majority of
international and domestic services wish to arrive at and depart from Sydney Airport.
The Federal Government, with the support of a number of federal agencies such as the ACCC,
has recently renewed pressure to build a new airport. The International Air Traffic Agency also
supports this position7. Generally this position is substantiated by concerns over the misuse of
the Airport’s monopoly over Sydney air services. In March 2010 the ACCC released their 2008-
09 Airport Monitoring Report8. It expressed concerns about monopoly pricing for car parking and
also observed that Kingsford-Smith Airport had increased profits at the expense of the quality of
services. In April 2011 the Federal Minister for Infrastructure, Anthony Albanese said in a press
conference on the matter: “'I can understand Sydney [Kingsford-Smith] Airport wanting to
maintain its monopoly position but the truth is a global city such as Sydney needs a second
airport9.”
Finally the newly elected NSW Government leader, Barry O’Farrell, has argued against a new
airport in favour of a new high-speed rail network connecting the major population centres on
the Eastern seaboard. “'Whether the central coast, the south-west or the western suburbs, find
6
SAC. 2011. “Economic Regulation of Airport Services - Submission to the Productivity Commission
Inquiry”. Retrieved from: http://www.pc.gov.au/ .
7 th
Saulwick, J. 11 April 2011.”Call for ACCC inquiry into Sydney Airport”. The Age. Retrieved from:
http://w http://www/theage.com.au/ .
8
ACCC. 2010. “Airport monitoring report 2008–09: price, financial performance and quality of service
monitoring”. Retrieved from: http://www.acc.gov.au/ .
9 th
Sky News. 5 April 2011. “Another Sydney airport a must – Albanese”. Sky News. Retrieved from:
http://www.skynews.com.au/ .

6. me an area that is not going to end up causing enormous grief to people who currently live
around it10.”
This cost-benefit analysis will compare in detail the leading first three proposals. This is for
efficacy purposes and to not clutter the comparison with proposals that will ultimately prove
physically or politically infeasible. Finally, cost-benefit analysis is complex and predicting the
impact of the final three proposals is beyond the scope of this memo. Specifically, Proposal 4 is
less preferable than Proposal 3 because of the immense distance any other site has to
overcome in connecting with Sydney. Proposal 5 is also physically infeasible given the current
space restrictions and inability to reclaim more land in Port Botany. Finally Proposal 6 to build
high-speed rail almost 2,000 kilometres between Brisbane, Sydney and Melbourne is not a
practical solution because it will not be able to be achieved within the given timeframe, or at a
reasonable cost.
Decision Criteria
The Kaldor-Hicks criterion is the basis of cost-benefit analysis. It states, “A policy should be
adopted if and only if those who will gain could fully compensate those who will lose and still be
better off11.” It is a method designed to achieve the most allocative efficient public policy
proposal. It is most suited to infrastructure project appraisal as it allows for a systematic
consideration of all potential impacts of an appraisal, both positive and negative. The major
downside of cost-benefit analysis is that it does not consider equity considerations, for example
the issue of equity in building a new airport in the lower socio-economic Western suburbs to
avoid noise and congestion impacting wealthier residents in Sydney’s East and Inner West. The
Policy and Strategy Unit (PSU) argues that while cost-benefit analysis is certainly the most
appropriate way of appraising infrastructure projects, the NSW Government should also
consider compensation, where necessary, as a method for achieving a more equitable policy
solution.
Additionally, all proposals must be considered within the light of political feasibility. Part of the
reason why all new airport proposals since the 1970s have failed is because of the political
saliency of the issue to the electorate. NSW is perhaps the only jurisdiction in the world that has
10 th
Saulwick, J. and K. Munro. 6 April 2011. “O'Farrell calls for high-speed trains instead of second
Sydney airport”. Sydney Morning Herald. Retrieved from: http://www.smh.com.au/ .
11 th
Boardman, A. E et al. 2011. Cost-Benefit Analysis: Concepts and Practice (4 ed.). Pearson: Upper
Saddle River, NJ. Page 253.

7. well-organized “No Aircraft Noise” Party running at elections12. The political situation is
complicated by the different positions taken by the Federal and State Governments.
Analysis of Alternatives and Decision Matrices
The following will address the methodology the PSU adopted for cost-benefit analysis of the
three proposals. Cost-benefit projections are made over the period 2013-63.
Cost to Local Residents
There are many social costs associated with living close to an airport, including noise pollution
and increased traffic congestion. The most straightforward method for assessing all these costs
is by using the hedonic regression method. The PSU constructed a dataset of 107 suburbs
located within 1.0 to 14.0 kilometres of Kingsford-Smith Airport, combining:
 all median house sale price data for the last 24 months from www.domain.com13;
 the direct distance of the suburb from the Kingsford-Smith Airport and the Central
Business District; and
 a dummy if the suburb is on the coast, Sydney Harbour, Port Botany or Port Hacking.
Households reveal a preference for paying more for properties closer to the CBD and for those
on the water, while paying if closer to the airport. The PSU performed the following hedonic
regression14:
The results for all three independent variables was highly significant. Figure 2 shows property
prices improved by A$73,000 with every kilometre further away from the airport, while moving
closer to the CBD improves prices by A$59,000. Coastal status causes prices to jump
A$282,000.
The co-efficient β1 for distance from the airport can be used for assessing the social costs of the
proposed new airport on residents around the Badgery’s Creek site because it captures the
12
In 1995 State Election the Party managed to achieve 39.55% in the electorate of Marrickville
(Reference: http://www.noaircraftnoise.org.au/).
13
www.domain.com is the major online residential property search engine, combining data on all publicly
available property sale data.
14
For simplicity the functional form is assumed to be linear, however in reality it is likely the relationship
between distance and property prices is of a quadratic form.

8. price of avoiding the costs associated with living near an airport. Figure 3 shows the affected
population living within 5km, 10km and 20km of the proposed site15.
Figure 2: Hedonic Regression of Distance from the Airport Against Median House Price
Figure 3: Affected Populations Surround Kingsford-Smith Airport and Badgery's Creek
Given the PSU assumed the social costs to be linearly associated with distance, we evaluate
the social cost affecting values within a 10 kilometre threshold. Residents within 5 kilometres of
15
Webb, R and R. Billing. 2005. “Second Sydney Airport – A Chronology”. Parliamentary Research Paper
(Economics, Commerce and Industrial Relations Group). Retrieved from: http://www.aph.gov.au/ .

9. a new airport will bear a total social cost of A$1.1 billion and those within the 5-10 kilometre
range will incur A$1.2 billion. It is assumed this figure is the discounted net present value of all
future social costs and is borne by present owners, so is incorporated at the start of the project
in 2013.
If the federal legislation was changed at Kingsford-Smith Airport to permit the airport to avoid a
regulatory constraint on flight-movements, the PSU can model the effect by the following
method:
1. Find the total net present value of the cost on property prices for the current limit of 80
flights per hour (A$48,243 million).
2. Find the annual discounted cost to property owners over the long-term (A$3,260 million).
3. Multiply this discounted cost by the amount Kingsford-Smith Airport is projected to
exceed the 80 per hour limit every year. This equals A$33,700 million.
Cost of Flight Delays
As Sydney Airport approaches capacity it will create costs to passengers of flight delays.
According to projections performed by consultancy Tourism Futures International and
independently reviewed by Booz Allen Hamilton16 the daily flight movement on a typical “busy
day” will look something like Figure 4, with the 80 flights per hour constraint being reached from
around 0730 to 1230 and 4: Typical "Busy Day" Traffic Projection in 2023
Figure briefly at 1900.
16
SAC. 2006. “Aviation Activity Forecasts 2006”. In Sydney Airport Master Plan 2006. Retrieved from:
http://sydneyairport.com.au/ and SAC. 2009. “Aviation Activity Forecasts 2009”. In Sydney Airport Master
Plan 2009 Retrieved from: http://sydneyairport.com.au/

10. To evaluate the cost increase in flight delays the PSU projected the trend in flight delays into the
future. In the period 2005-10 the proportion of on-time flights decreased from 85.8% to 79.7%,
averaging a 1.46% decrease per year. The PSU projected a similar trend until 2029, with the
trend slowing to -0.05% thereafter. Average length of delay is held constant at 20 minutes. This
is a conservative estimate of the delay profile if the status quo is maintained, as the congestion
that is likely to occur around peak times will certainly increase the average length of delay. The
annual percentage of delayed passengers is then multiplied by the projected number of
passenger movements through Kingsford –Smith Airport and the average length of delay to
arrive at an estimate of total passenger-hours lost each year to flights delays.
As the most important airport hub in the country, delays at Kingsford-Smith Airport also flow-on
to have significant delays at other airports around the domestic network. Welman et al17 in an
extensive empirical study calculate the propagation multiplier for cost-benefit analysis to be
consistently around 0.50. Therefore to capture the time lost in passenger delays at other
airports we multiply the Kingsford-Smith delay figure by this propagation multiplier.
Finally, the PSU assessed the economic cost of these flights delays. We assessed the cost only
to passengers, however in reality costs would also be borne by the airlines. Taking the average
annual salary of A$57,324 would suggest an average hourly wage of A$19.60 based on a 8-
hour working day. This figure is used as our estimate of the economic cost of lost hours through
delays, resulting in a total cost projection of A$11.37 billion over the next 50 years18.
Capital Costs of a New Airport
Estimates of capital cost are mainly derived from the NSW Government submission to the
Federal Government Environmental Impact Assessment conducted in 199919. The major costs
associated with building the new airport are shown in Table 1. These costs are factored into the
analysis as spread evenly over the construction phase from 2014-2016.
17
Welman, S., A. Williams, and D. Hechtman. 2010. “Calculating Delay Propagation Multipliers for Cost
Benefit Analysis”. Retrieved from: http://www.faa.gov/
18
.
Or A$1.47 billion discounted at a rate of 5.5% per annum.
19
NSW Government. 1999. “Submission by the NSW Government to the Commonwealth Minister for the
Environment and Heritage Concerning the Environmental Impact Assessment for the Proposed Second
Sydney Airport”. Retrived from: http://badgerysacpnp.homestead.com/files/NSWGOVSUB.htm .

11. Project Estimated Cost
Airport and Runway A$1.5 – 3.0 billion
Upgraded Rail Link A$1.6 billion
Road Upgrades and Connections A$1.4 billion
Water Connection Upgrade from Warragamba A$120 million
Dam - Sydney
Table 1: Projected Construction and Associated Costs
Alternative Land Use at Badgery’s Creek
The Badgery’s Creek site, while located a significant distance from Sydney’s CBD, is still
valuable for its outstanding access to major road transport networks and as a potential site of
future urban intensification as the Sydney metropolitan area expands. The PSU have valued
these alternative uses at A$180 million annually, based on comparable land uses in the vicinity
of the site.
Welfare Gain for Passenger Increases
A new airport at Badgery’s Creek provides the opportunity for more passengers to fly in and out
of Sydney, presumably at cheaper prices. The PSU evaluated the welfare gain to passengers of
a new airport by estimating the following alternative scenario to the status quo projections.
Annual Passenger Movements in Selected
Regional/Secondary Airports
6,000,000
5,000,000
4,000,000
3,000,000
2,000,000
1,000,000
0
CANBERRA GOLD COAST HOBART TOWNSVILLE
Figure 5: Comparable Regional and Secondary Airport Passenger-Movements, 1985-2010

12. Firstly the PSU compared a number of other single-runway airports within Australia. Four
comparable single runway airports in Australia would be Hobart, Townsville, Canberra and Gold
Coast. The former three are large regional airports, while the Gold Coast caters to both as an
international holiday destination and as Brisbane’s second airport. Since the end of price
regulation in 2001, annual growth rates in passenger movements have varied between 7.5%
(Canberra) to 14.9% (Gold Coast). Given the latent demand expected to be satisfied by a
second Sydney Airport, the PSU forecasted annual growth in excess of the regional airports
(10.3%) but below that of the Gold Coast (14.9%), as initially at least it will not be conducting
international services. Initial movement numbers would start between 1,200,000 and 2,000,000.
Single-runway airports are currently effectively limited to absolute maximum of 35 million
passengers annually20.
Projected Annual Passenger Movements, Second
Sydney Airport
12000000
10000000
8000000
6000000
4000000
2000000
0
2017 2019 2021 2023 2025 2027 2029
LOW HIGH EXPECTED
Figure 6: Annual Passenger-Movement Projections, Second Sydney Airport 2017-2029
A certain amount of passengers at the new airport are expected to be substituted travellers from
Kingsford-Smith Airport. The PSU conservatively estimated 80% of passenger-movements at
the new airport will be substituted away from Kingsford-Smith. The additional new passengers
are thought to be dominated by price-sensitive domestic passengers, non-connecting flight
passengers and residents of Sydney’s Western suburbs. A new airport can be expected to
facilitate 1.3 million additional annual passenger-movements through Sydney by 2029.
20
London’s Gatwick Airport is the busiest single-runway airport in the world and facilitated 31,375,290 in
2010.

13. Sydney Total Passenger-Movements Projections
90000000
80000000
70000000
60000000
50000000
40000000
30000000
Total Sydney Airports (with New Airport) Total Kingsford-Smith Airport (without New Airport)
Total Kingsford-Smith Airport (with New Airport)
Figure 7: Total Sydney Passenger-Movement Projections, 2007-2029
Economic Stimulus for Western Sydney
The most difficult benefit to value is the economic stimulus a major new airport project will
provide to Western Sydney. Direct full-time equivalent employment rely on a number of
functional aspects of an airport, such as international, defense or aerospace facilities and the
quantity of retail space. For the purposes of comparison the PSU collected direct employment
data from airports’ most recently published 5-year master plans.
Airport Direct FTE Equivalent Annual Passenger-
Employment Movements (thousands)
Sydney (Kingsford-Smith) Airport 36,882 32,346
Brisbane Airport 16,000 18,721
Melbourne (Tullamarine) Airport 12,542 24,448
Canberra Airport* 8,000 3,062
Perth Airport 5,960 9,359
Adelaide Airport 5,070 6,784
Darwin Airport 1,641 1,539
Wellington Airport (NZ) 1,361 5,021
Sunshine Coast Airport 900 917
Newcastle Airport 383 1,173
Launceston Airport 319 1,127
Hobart Airport 250 1,869
*estimate includes defence and aerospace staff.
Table 2: Selected Australian Airports and Full-Time Equivalent Employment Figures

14. With a reasonable volume of retail space the PSU projected that a new Sydney Airport would
facilitate employment of between 3,000-3,500 FTE staff on the average Australian salary. For
the effect on indirect employment and spending in Western Sydney, the PSU then used a
conservative multiplier of 2.021. The economic effect of the construction phase is also difficult to
project depending on whether there are cost or time over-runs. The PSU projected total
economic stimulus to Western Sydney to total between A$49.0 - 66.4 billion from the present
until 2029 based on low passengers and late construction and high passengers and early
construction (see Figure 8).
Projected Economic Stimulus to Western Sydney
1000
900
800
700
600
500
400
300
200
100
0
2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029
High Economic Stimulus Low Economic Stimulus
Figure 8: High and Low Economic Stimulus to Western Sydney
Social Discount Rate
For the social discount rate the PSU adopted the standard NSW Government Treasury rate of
7.0%. This compares favorably with the average rate for 10-year Australian Government bonds
of 6.0%. Long-term NSW Government bonds rates are quite similar to federal rates.
Government bond rates reflect the actual cost of financing such infrastructure projects in the
long-term; however it is acceptable with such a project to raise the rate higher to account for
21
California Aviation. 1988. “Determining Your Airports Economic Impact”. Retrieved from:
http://californiaaviation.org .

15. project risk22. Moreover sensitivity analysis of the discount rate shows that building a new airport
is preferable over a wide range of discount rates. Given that most of the benefits of a new
airport accrue over the long-term, the lower the discount rate the higher the potential benefits. A
new facility is preferable for all discount rates of 9.9% and below.
Decision Matrices
The following decision matrix is a comparison of the cost-benefit analysis of the three policy
options. Figures are discounted by 7.0% from the year 2013.
Policy A (Status Policy B (Remove Policy C (New Airport)
Quo) Movement Cap)
COSTS
Costs to Local No additional. High cost to Moderate costs to
Residents residents ($33,700M) residents ($2,400M)
Costs in Flight Moderate cost to No additional. No additional.
Delays passengers ($907M)
Capital Costs None. None. Significant capital cost
($5,178M)
BENEFITS
Alternative Land Large benefit Large benefit None.
Use Benefit ($14,606M). ($14,606M).
Welfare Gain No additional. Small benefit Moderate benefit
Passengers ($907M). ($2,827M).
Local Economic No additional. No additional. Large benefit to Western
Stimulus Sydney ($11,779M)
NET SOC. BEN. $1,881M $7,099M -$19,094M
The PSU recommends the development of a new secondary Sydney airport at Badgery’s Creek
as over the next 50 years Australians will realize A$5.22 billion dollars worth of social benefits,
above and beyond the status quo. Removing the regulatory cap at Kingsford-Smith is not a
socially efficient policy solution.
22 th
Boardman, A. E et al. 2011. Cost-Benefit Analysis: Concepts and Practice (4 ed.). Pearson: Upper
Saddle River, NJ. Page 253.

16. Political Analysis
As explained above, the politics of airports in Sydney is complicated, polarized and salient. The
key stakeholders are:
1. Sydney Airport Corporation (owned by Macquarie Bank) with a vested interest in
maintaining its monopoly;
2. The Federal Government, its agencies, IATA and the airlines who would like to see that
monopoly broken for competitive reasons;
3. City residents, loosely organised by “No Aircraft Noise” and others, who strongly oppose
increases in aircraft traffic at Kingsford-Smith. They are the most currently vocal and
powerful NIMBI group.
4. NSW Government, who out of concern for an latent electoral backlash in Western
Sydney, has avoided the new airport proposal; and
5. Passengers, who stand to gain substantially from a new airport, but so far remain
unorganized and neutral.
Strongly Opposed Neutral Favour Strongly
Opposed Favour
Federal Gov.
NSW Government 
ACCC
IATA
Mac. Bank
SAC
No Aircraft
Noise
Activists/Party
Western Sydney 
Residents
Passengers 
Airlines
NSW Bus.
Chamber
The following political map shows the relative position of the different key actors. A possible
strategy for achieving the desired policy goal of a new airport is for the Federal and NSW
Government to work together on a join taskforce to implement the project. Passengers are also
a latent group of potential supporters who could be mobilized if they understood their full
benefits. There may be opportunities for the NSW Government to win the support of some

17. Western Sydney residents if they: (a) understand the economic benefits; and (b) can be partially
compensated for the additional congestion and noise. As the lack of public transport facilitates
in the Western suburbs has also been a long-standing political issue, compensation might take
the form of investment in better public transport and rail links.
Policy Recommendations
We make the following policy recommendations to the Director-General of NSW Planning and
Infrastructure:
Political feasibility
(1) Drop the NSW Government’s current opposition to a new airport facility for Sydney.
(2) Engage the Federal Government in a joint taskforce to implement a second airport for
Sydney at Badgery’s Creek.
(3) Make a call for tenders to develop to site by late 2012.
(4) Work towards a building and construction phase between 2014-2016, with the goal of
opening the new airport by 2017.
(5) Offer inducements to encourage an existing low-cost carrier to use the new airport as
a regional hub.
(6) Reconfirm the NSW Government’s commitment to limiting air traffic using Kingsford-
Smith Airport.
(7) Develop a communication strategy to explain the economic benefits of a new airport
to passengers and Western Sydney residents.
(8) Devise a strategy for partially compensating Western Sydney residents for increased
congestion by making a significant investment in advancing public transport in the
area.