Business may lose $1.6bn without Badgerys

It's comforting to note business groups sharing residents concerns with airport traffic problems. Why on earth might anyone want Bangkok at Badgerys Creek ? Or even half it ?

If you were saving $20 million a year, you could probably buy a new yacht or two with the proceeds, and feel very comfortable about it.

The submission is at odds with the views of most local councils in the area, which want a second airport outside the metropolitan area. But business leaders insist that from an economic perspective, Badgerys Creek is the only choice.

The submission estimated that by 2020 more than half Sydney's air freight exports would come from areas closer to Badgerys Creek than Sydney Airport. It said businesses would save $20 million a year in travel costs if the second airport was built.

It also warned that "following discussions with freight forwarders and airport users, a conservative estimate of lost export freight because of capacity constraints in 2020 is around 6 per cent of total freight exports".

"The lost opportunities would be concentrated in the food and high-value-added complex manufacturing sectors. This would be equivalent to lost production of at least $1.6 billion annually.

The trouble with figures like this $20 million, and the lost production of $1.6 billion are that they're often very biased guesswork

Worse, the lost production figure doesn't tell you how much profit it corresponds to, and how much tax could be raised from that profit. Nor does it tell you where else that productive effort might be redirected without the airport (e.g. cargo carried on a fast train).

Claims of the huge lost profits of not building an airport might be more credible if they were accompanied by a business plan showing how the taxpayer would recover the money's invested to build the airport.

Better still, why don't these business groups put their money where their mouths are ? Let them come up with their own plan for an airport development, and fund the planning, EIS, construction and operation out of their own pockets.

That way taxpayers could have some confidence that this is not just another case of business putting its hand out for another nice fat cross-subsidy from the public.

(see also related page Second Airport Affordability )

For the economists out there, Draft EIS Technical report 15 (Economics) states (p A-8):

However, the EIS is largely a comparative assessment of the two alternative sites for the Second Sydney Airport. A decision has been taken that Sydney is to have a second airport.

The report fails to carry out any analysis of alternative investments. Alternatives might be things such as a fast train, or much needed hospitals. Or they might consider what could be produced by other industries given a 17,000 hectare land grant and other subsidies enjoyed by the aviation industry.

The Draft EIS omits alternative investment studies because some bureaucrat has already decided we're going to have the airport - without validating that decision by critical review in an EIS. They really don't want us or Parliament to know how they could have made that decision better.

Just the way you ought proceed if you want to quietly slip a few billion dollars of public funds to some mates.