The catch cry of privatised big city airports in Australia used to be ’sweat the asset.’
But the decision by the Infrastructure Minister Anthony Albanese to run the plans of Sydney Airport through the wringer at Access Economics suggests that ’sweat the owner’ could change this.
This report appeared in the Crikey Daily Email to subscribers yesterday.
Infrastructure and Transport Minister Anthony Albanese’s diligence in getting Access Economics to put Sydney Airport’s 20 year master plan under the microscope points to a policy break point in relation to privatised airports in general.
There is, according to the leak in the Sydney Morning Herald, little doubt Albanese will sign off an approval of the plan by this Friday.
But it is the finding of the review, that the plan is inadequate, that now sets the scene for the selection of a site for a second Sydney airport.
When the gateway airports were sold to private consortiums, with Sydney the last to go in 2002 for $5.6 billion, the cash bonanza to Canberra came with the loss of real competition as well as planning control over vital airport infrastructure in perpetuity.
Buying a capital city airport was seen as acquiring a licence to gouge the airlines and the public for ever.
But perhaps the government is now signalling that this isn’t necessarily so.
Sydney Airport is still reported as being $6 billion in debt, and has crawled to the airlines begging their indulgence over its unwillingness to pay for $90 million in fairly ordinary upgrades in the next 18 months.
All work supposed to be paid for out of the fees it has been charging the airlines.
Sydney airport’s cash needs are much less about funding future infrastructure than funding the financing structure set up when the Macquarie Bank lead consortium offered the biggest windfall to the Howard Government.
Sydney Airport’s incapacity to handle a projected 79 million passengers a year by 2029, as claimed in the Access Economics review, is a serious blow to the grip the city has on being Australia’s main gateway.
Both Melbourne and Brisbane (including the corridor to the Gold Coast) can strip Sydney of the economic benefits of being the business and tourism hub of the nation by exploiting easy and convenient options for growing their existing main airports or even in the case of Brisbane, replacing the Gold Coast airport with one located midway between the northern end of the strip and Brisbane.
It is in planning terms, as easy for Melbourne or SE Queensland as stealing candy from a baby.
The burning issue of course is where would a second Sydney airport be. There is a perfectly good site at Badgerys Creek within easy reach of the M7 Motorway, but somehow, it is considered political poison.
Or there is the option to fit a handful of domestic flights into Bankstown and Richmond, each of which comes with the certainty of their own poisonous political consequences.
Or there is the bankrupt-the-nation option of building a remote second Sydney Airport that is guaranteed to drive the major generators of business out of Sydney, because the prerequisite of reliable, frequent and convenient air links do not by definition come with a two hour trip to or from Bullamakanka.
And there is another trap in this for Sydney. The notion that somehow ‘nice’ business travellers will be segregated into full service flights to Sydney Airport, while the low cost segment somehow absorbs the costs of a transfer to the bush is ludicrous.
In reality, the days of such segregation are going the same way as first class on horse drawn trams 100 years ago. Almost all air travel, including corporate travel, will be made on lower-cost-carriers in the future, and the days of largesse in business flights are over, as carriers low cost and higher cost all scramble to put in premium economy products to deal with the changed reality.
The situation facing Albanese, and Sydney, is very messy. But the times have changed, and the comfortable assumptions once made that Sydney Airport could always meet the city’s needs are about as stuffed as its access to future port facilities.
7 Comments
Ben, one thing I’ve always wanted to point out to you when you talk about an airport outside of the basin being impractical or unuseable: The example of Narita, Tokyo’s airport.
The fastest way to get to Narita is the Narita Express fast train, which takes 60 minutes from Tokyo station – 80 minutes from Shinjuku and 90 minutes from Ikebukuro (which could be considered as to Tokyo as Parramatta is to Sydney). The alternative “Airport Rapid” takes 90 minutes from Tokyo. Narita doesn’t seem to have suffered for this.
Hypothetically an airport in the Southern Highlands could offer comparable travel times.
I think there is a lot to agree with in general with your analysis, but there are also some critical differences.
Badgery’s Creek is comparable in distance and achievable trip times by various modes to the Sydney CBD as Narita is to Tokyo Central. It is also very convenient to Parramatta and the Hills District and because of the configuration of the M7/M2 to the upper north shore.
The southern highlands sites are more than twice as far from the Sydney CBD as Narita is from Tokyo Central. The rail link from Narita is good, but I’d argue, not as good as it could be if it was lifted to the standards of the newer shinkansen services. If we were to look to a high speed rail link from Badgerys Creek to Central I’m sure we could do better than 60 minutes even without changing the appalling history of railway incompetency in NSW. In the interim the M7 would work well, although I believe a duplication of lanes like we now see on the M5 would be required in the medium term, or maybe a direct set of links to the M4 and eventually the M5/M7 at Prestons or nearby.
The Japan market has also been impervious until at least recently to the low cost airline model. This is changing, and will accelerate the pressures that have already lead to Haneda (which is for most people the more convenient Tokyo airport) being significantly expanded rather than quarantined as before to assist the viability of Narita.
Ben – the lack of decision on a (necessary) second airport for Sydney is a national disgrace. Why can’t pollies make a decision for the common good. I agree it would have to be Badgerys – Richmond has very limited potential, it fogs in frequently and an engine failure taking off to the west would have a plane entering the rock-filled clouds of the Blue Mountains. Brisbane/Gold coast has great potential. As you suggested yesterday, a new airport midway between Brissy and GC would be the go and close Coolangatta. Of course, this is what should have been done in the late 70s when Brisbane airport was redeveloped and a combined facility built. Are you aware that the 01/19 runway alignment at Brissy was chosen for political reasons and not operational ones? At the time, then Liberal member for Lilley, Elaine Darling didn’t want aircraft noise over her electorate so she lobbied Malcolm Fraser to change the alignment. It should of course be a NW/SE alignment like most airfields on the east coast. Ironically, if the second parallel runway is ever built at Brissy, the silvertail suburbs of Ascot and Clayfield will have all up weight Jumbos taking off over them in the winter when the westerly winds blow here. Alex
That explains what always seems like a strange alignment. As Sydney seizes up the contest between Brisbane and Melbourne to be the premier gateway will be very tight, but one or the other could take over that spot, and all the economic benefits derived from it, and by 2016 at a guess as to the earliest, and 2020 with very little room for doubt as of today.
Ben – a shinkansen service from Tokyo to Narita would probably be hard to justify economical because of the relatively short distance involved. (Most are long distance with the shortest one only being built because it terminated in the home town of a former Prime Minister). The current express service trains are modern, fast, and very comfortable. It took a few years to get it up to this level though. I remember in the early 80s before they had a train service to Narita, the journey by bus seemed to take an eternity – over 2 hours – though it was cheap at the time with a strong Aussie dollar ($A9.50).
As a relatively frequent user of Narita Airport (and first-time Crikey blog poster) I feel the urge to comment.
The current express trains to Narita are pretty good – although I prefer the private Keisei Line to the JR Narita Express. But the next generation will be a leap ahead. The Narita Rapid Railway, which is scheduled to open in late 2010 (although one might expect the schedule may well slip…) will cut the journey time from Ueno (a major rail hub) to the airport to 36 minutes. There are lots of signs up at Narita Airport (mostly only in Japanese) advertising it.
http://en.wikipedia.org/wiki/Narita_Rapid_Railway
I would imagine that the trains, although not Shinkansen themselves, would use some aspects of Shinkansen technology, as they will run at up to 160 km/h.
No word yet on the price AFAIK… which will of course be the key. The current Keisei Line Skyliners cost about 2000 yen for the Ueno-airport trip, and the regular expresses a cheap 1000 yen.
If nothing else, this will help to ‘bring the airport closer to town’ and, along with turning Haneda into a proper international airport, finally bring Tokyo’s airport infrastructure up to something approaching a decent level.
I dare say that BS (appropriate initials) does not live near the BCA flight paths (if the potential white elephant ever comes to fruition).
The fact of the matter is that the BC site has so many environmental strikes against it, it could never pass any kind of rigorous environmental assessment never mind the lives of millions who would be blighted by the noise of aircraft passing over their homes.