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This study emphasises the value (costs and benefits) projected by the western Sydney airport after following the economic constraints in the society welfare. We evaluate this value for the current value (net present value) which is projected into the future (13 years) to ascertain for the future expected return from the project. We use a discounting rate (5%), these values over some years to ensure the validity of the information obtained.[ CITATION Geo01 l 1033 ] The project analysis is done to ensure efficiency and effectiveness in production and provision of essential service to the society by the government. The decision method of Net Present Value is used to evaluate these discounted value to measure the degree to which the Airport of Western Sydney benefits exceed costs. The Airport of Western Sydney is estimated to cost $2.4 billion as at 2012. We will not ignore the uncompensated costs incurred by utilising the Bargery’s creek highways.

Other government provided projects to accompany this project such as M4 motorway upgrade, WestConnex, M80 Ring Road Upgrade, and Melbourne Metro Rail among others. The western Sydney Airport project is expected to reduce the congestion in the city by 25% making it very easier for network and communication within the town and its outskirts. The capacity is rated very high to ensure cheaper means and alternative for the road and railway transport.

Problem statement.

Western Sydney roads and communication channels intensively overfill with large traffic. Capacity is limited to due lack of space, Unconducive federal regulations for the limited traffic volume, also lack land based transport substitutes.


The main objective was to promote the effectiveness of the road transport found to be very low hence the need for an alternative way of transport in the western Sydney region. The aim was to reduce the traffic congestion and create an alternative method that is substantially effective regarding cost and benefits to the ordinary people in this area. Secondly, was designed to ensure reduction of unemployment to a greater extent. It was with the purpose of creating employed to the residents and society as a whole. The project is expected to yield over 40,000 job vacancies. The unemployed in the community have a chance of securing an opportunity as a mutual benefit alongside ample transportation services.


Key benefits from findings of the analysis demonstrate airport of Sydney generates great economic importances for the area and the region of New South Wales more widely[ CITATION FMe15 l 1033 ]. The Airport is expected to serve the national and international transport purposes. The airport operation and research indicate that: (1) An approximated effect on the economy of Western Sydney over the period between 2020 and 2050 was ranging from $9.2 billion to $15.6 billion, and on the whole of the economy of Sydney of between $15.7 billion and $25.6 billion. (2) This project is in Average to create additional employment within the period estimated to range from (40, 000-60,000) ranging between (12,645-19,982) FTEs for West of Sydney, and also ranging from (20,601-31,736) FTE for the great Sydney region.

Participant group


Transport consumers

Commuter’s bills

Transport provision

Local society

Land loss

Environmental pollution

(Noise and air pollution)

Increased gap in income earning

Lost farming land(capital)

Lost output flow

Land price (compensation) according to the provision of current land market prices.

Construction industry

Costs of construction involved

Productive assets(capital)

Increased sales and profits from the industry.

Note: The costs are valued at their current market prices

Value of impacts (costs and benefits)

The costs value of resources used in the construction of western Sydney airport and the operation, cargo base, surveillance monitoring centre, etc. will be available for other purposes hence considered as an opportunity cost.

The basis inwhichresources are utilised in this project is procured in the competitive market to achieve a good approximate of the economic value. Costs are valued at current prices in the market. Construction costs spread over the period 2012 to 2016. The estimates budget the northern road upgrade to the plan with $3.6 billion as in the western Sydney infrastructure program[ CITATION Asw14 l 1033 ]. The farmers land used in the construction of the airport about 500 hectares is valued at a market price $1800 per hectare since it’s in the urban area. It ensures that the airport will potentially grow rapidly in a span of 10 years.

Construction Operation

Runway $100 Runway $500 pa

Surveillance $80 Surveillance $220 pa

Equipment’s $1200 Equipment’s $2500 pa

Garage $60 Garage $150 pa

Note: The costs are valued at their Current market prices

Decision criteria

The western Sydney discounted benefits for thirteen years indicate that there will be a high degree of achieved efficiency. It has an impact on the society’s welfare. The decision method is the cost benefit analysis[ CITATION AMy14 l 1033 ]. It is between the current and the future consumption trade off as shown below. If the ratio is greater than one, there are accrued benefits to the society and vice versa is also true. Here we will use the method of cost-benefit ratios.

Total costs PV

$1440 million

total benefits PV

$3370 million

Benefit Cost Ratio

$1930 million

The ratios indicate that the project is worthy of the support of the economic grounds. As a result, it observes the efficiency of utilisation of resources.

The project will be vulnerable to the dynamics of the economy. It is due to the estimation of the costs of putting up the airport. The future expected growth in population etc.

CBA conducted indicate that the western Sydney airport potential to grow regarding provisions to the society in the economic welfare, and also expand in the remaining resources. These conclusions are reliable as indicated by sensitivity report of analysis. The environmental damages caused should be provided by compensating them to ensure minimal damages to the residents.


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Freeman, A. M., 2014. The advantages of environmental improvement theory and practice. 2014 ed. Baltimore: Johns Hopkins University Press.

Kingston, G., 2001. The Cost-Benefit Analysis in Practice and Theory by Geoffrey Kingston. The Australian Economic Review, 34, no. 4: 478-487 ed. Canberra: Blackwell Publishing.

Melese, F., Richter, A. & Solomon, B., 2015. Military cost-benefit analysis: theory and practice. 2015 ed. Routledge: London: Taylor & Francis Group.