Sydney needs a second airport: it’s as simple (and as complicated) as that

Sydney’s Airport’s international terminal. Sydney Airport

Does Sydney need a second airport? In the the recent furore, Foreign Minister Bob Carr, former Prime Minister Paul Keating, Qantas CEO Alan Joyce, former Federal Transport Minister Peter Morris, and former NSW Premier Nick Greiner have all called for another airport to be built.

But first, let’s put the need for a second airport in context. Why does Sydney need a second airport? How soon does it need it? Are there any similar examples overseas? And why are our politicians having so much trouble making a decision?

Sydney Airport: 36 million passenger movements per year …

Looking at air traffic numbers, it is clear that Australia’s airways are busy - and not just from overseas travel.

According to data released by Amadeus (a company servicing the travel industry), the Sydney-Melbourne route was the fifth busiest in the world in 2011 (by number of passengers). At slightly more than 7 million seats, Sydney-Melbourne came after South Korea’s Jeju-Seoul (close to 10m), Brazil’s Rio de Janeiro-Sao Paulo (about 7.7m), and Japan’s Osaka-Tokyo (about 7.6m). Other busy routes include Beijing-Shanghai (7th) and Mumbai-Delhi (10th).

When taking respective population masses into account, Australia’s results are nothing short of spectacular.

Sydney’s airport caters for most of Australia’s air travel, both domestic and international. The airport is currently coping with about 36 million passenger movements and 320,000 aircraft movements annually. By 2035, the airport needs to be able to cope with 80 million passenger movements (double the current number) and nearly 430,000 aircraft movements (an increase of 50%) per year.

When compared to other capital cities, Sydney is clearly Australia’s main point of arrival and departure for international travel, as shown in the figure below.

Australia’s international passenger traffic, share by airport, 1990 to 2010. Department of Infrastructure and Transport

… and counting, with increasing traffic demands

In March 2012, Federal Transport Minister, Anthony Albanese, released the “Joint Study on Aviation Capacity for the Sydney Region” report. The study was overseen by an independent steering committee of government and industry experts.

According to the report, if Sydney’s future aviation needs cannot be met by 2060, the economy-wide impacts across the Australian economy could total $59.5 billion (in 2010 dollars) in foregone expenditure and $34 billion in foregone gross domestic product. The report warns of thousands of lost jobs and major traffic and train congestion if a second airport is not built.

It also warns that by around 2027, all flight slots will be allocated. In other words, unless another service is cancelled, no new entrants can be accommodated. By around 2035, there will be practically no scope for further growth at the airport. Forecasted shortfalls are shown in the figure below.

Expected capacity shortfall for passengers at Sydney Airport, 2010-2060. Department of Infrastructure and Transport

Clearly, the airlines are a major stakeholder when it comes to building a new airport. If an airport meets full capacity, airlines’ bottom line is likely to suffer.

As such, Qantas CEO Alan Joyce has been quite vocal on the need for another airport - speaking of the two hours it often takes for Qantas Boeing 747s to be towed through Sydney airport and congestion routinely causing planes to spend 30 minutes circling above the city, while others were unable to take off on time.

For all the reasons mentioned above, a second Sydney airport seems critical for both NSW and Australia’s sake.

Air traffic slowed down by politics

The debate over a second airport in Sydney is not new. The discussion started back in the 1970s when the Major Airport Needs of Sydney (MANS) group was established to select a site. The group identified both Wilton and Badgerys Creek as potential locations.

In 1989, Bob Hawke put off construction of a new airport and built a third runway at Kingsford Smith. In 1995, Paul Keating legislated funding to build a Badgerys Creek airport, but John Howard revoked the funding and opted for expansions at Bankstown and Canberra airports instead. Badgerys Creek is actually owned by the Federal Government, but in 2009 Kevin Rudd had announced intentions to sell the land.

Over the past couple of years, Canberra has been increasingly mentioned as a possible alternative - a solution supported by NSW Premier Barry O’Farrell - with travel times reduced to 45-50 minutes using a high speed rail link between Canberra and Sydney. However, such plans have yet to materialise.

Going back full circle, the 2012 “Joint Study on Aviation Capacity for the Sydney Region” report states that Badgerys Creek - followed by Wilton - is the best site for Sydney’s second airport.

However, the current federal government has ruled out building an airport at Badgerys Creek, opting for Wilton instead.

All while Premier O’Farrell has repeatedly said that he did not support a second airport in the Sydney basin altogether.

Political games are clearly getting in the way of this decision.

Calls are now being made for the federal government to simply step in and get the job done as constitutional law experts say that the NSW government could not stop a second airport being built if the federal government decided to proceed.

Qantas CEO Alan Joyce has been quite vocal on the need for a second airport. Sydney Airport

Are other airports facing similar challenges?

When looking at airports elsewhere, there have been many instances of governments providing financial assistance with expansion of airport infrastructure.

Indeed, more than 600 international airports are publicly owned, according to a 2007 ICAO report. In Europe, 78% of all airports are publicly owned with a further 13% involving public partnership, according to a 2010 study by ACI.

Hence, when an airport is identified as approaching full capacity, the debate often turns political.

In the UK, aviation infrastructure around London has been identified as one of the most significant impediments to economic development. In 2003, a proposed expansion of London Heathrow Airport (one of the busiest airports in the world) was put forward.

The plan was supported by various groups including the British Chambers of Commerce, the Confederation of British Industry, the Trades Union Congress and the Labour Party. However, in 2010, the new UK government opposed it.

The debate still rages on - with London First, a lobbying group representing various London businesses, recently releasing a report pleading for an expansion at Heathrow.

Regardless of the chosen location, a new airport will be required to supplement the capacity of Sydney Airport within the next couple of decades.

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