'Odd messages' on infrastructure

THE head of the federal Treasury, Martin Parkinson, has issued a thinly veiled criticism of the NSW government for delaying the construction of a second Sydney airport while simultaneously approving housing under a potential flight path.

THE head of the federal Treasury, Martin Parkinson, has issued a thinly veiled criticism of the NSW government for delaying the construction of a second Sydney airport while simultaneously approving housing under a potential flight path.

Dr Parkinson said the national productivity debate needed to become more sophisticated, and arguments that focused on one issue only, such as industrial relations or management failure, were hindering the discussion.

He said one problem with the debate was that governments were sending the public "very odd messages" about the so-called infrastructure shortfall.

"One [thing] that has me particularly puzzled, and I'm not having a go at the NSW government, but on the one hand there's an argument put that we don't want to have a second airport in the Sydney basin - we want Canberra airport to play part of a role there," Dr Parkinson told the Association of Superannuation Funds of Australia conference on Wednesday.

"And yet at the same time that same government is actually approving housing underneath the flight path of Canberra airport, which will actually have the direct effect of restricting its capacity to play the role that people want.

"Now whether it can play that role is a different matter, but we've at least got to start having a sensible discussion that's joined up."

Earlier this month, Fairfax Media revealed that the NSW Planning Minister, Brad Hazzard, had approved rezoning to allow 2000 homes to be built at a housing development in South Tralee, south of Queanbeyan.

The managing director of Canberra Airport, Stephen Byron, has since said the move to build homes there would "severely" compromise the NSW government's plan to use the airport as an overflow for Sydney.

Mr Hazzard's move has since been criticised by members of the federal Coalition, along with members of the NSW and federal parties.

NSW Premier, Barry O'Farrell, has argued that Canberra Airport should be expanded so it could become Sydney's second airport.

Dr Parkinson said on Wednesday the debate about productivity in Australia was "very odd".

"I've been saying to people when I speak publicly that you do Australia and Australians a disservice if what you do is you talk about industrial relations as the only issue, or you talk about management failure as the only issue. This is a complex problem," he said.

He said we needed to think about everything from the taxation system, intellectual property and human capital creation.

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