With this momentous announcement, let the games begin.
There can be little doubt that having a separate owner for Sydney’s second airport is a good thing. Competition in the London airports market transformed and accelerated the growth rate of Gatwick Airport almost overnight.
So now the government(s) have a massive opportunity. Sadly, as usual they will however blow it.
Investing in an airport must be the perfect example of "good debt”. This is a public, long term, investment that Sydney Airport’s highly profitable owners does not want to risk. But if there is any surer good investment than a new airport for Sydney, we’d like to see it. With Australia’s airport privatisation record, this will generate excellent returns once it is set up to sell.
But - and there is a big BUT - small thinking will confine the airport to slow growth and inconvenience. And delay the time for reaping the rewards of the investment. This is an airport that should have been built 25 years ago, when the first sod was actually turned. Had it been built then, the demand would have swelled to such an extent that today it would be carrying at least 20 million passengers, capacity which the city needs to grow economically to its full potential.
But what we will get is a small regional airport that is poorly linked to the city and will be confined to being local activity. By looking at a modest airport, linked only by what will be an unpredictably long journey by road, wherever the origin, it will be a (small) white elephant for at least a decade.
The opportunity for remarkable change now exists. The Federal and State governments need to come together to make an investment that will transform Australia’s aviation and business system – with the prospect in future of selling down the airport for a substantial profit. What a great win-win deal.