High-Capacity Transport for Growing Cities

Australia’s population is highly concentrated in coastal regions, with around 73% of people living in major cities, 25% in regional areas, and less than 2% in remote zones.⁹⁴ Approximately 60% of the population is concentrated on the east coast, between Melbourne and Brisbane. The highest population density along this corridor is between Newcastle, the Central Coast and Sydney, at 624 people per square kilometre.⁹⁵ This pattern of population growth guides intercity infrastructure planning and delivery, and connectivity across regions.

Intercity connectivity is provided via road, rail, coach and air services. Typically, long-distance (over four hours) passenger trains have uncompetitive transit times compared to air and road travel.⁹⁶ As a result, Australia has some of the busiest air routes in the world, with the Sydney-Melbourne route the fifth busiest domestic route globally in 2024.⁹⁷ This is reflected in Table 13, which highlights that train travel times between Australia’s largest cities on the east coast remain long, with air travel holding the majority share of travel across all modes.

^Flight times are based on available information provided on flight operators’ websites.

As highlighted in the Australian Infrastructure Audit 2019, Australia’s reliance on air travel for long-distance domestic journeys poses continuity risks given the external influences that can affect air operations such as climate events and fluctuating fuel prices. There is also increasing congestion in and around airports in major cities, with the Bureau of Infrastructure Transport Research Economics (BITRE) projections showing domestic passenger numbers through Australian airports will increase approximately 116% under a baseline scenario between 2022-23 to 2049-50.¹⁰⁰

The Australian Government is currently investigating a high capacity high-speed rail link between Sydney and Newcastle, as a first stage to a national network, with the long-term vision to connect Brisbane, Sydney, Canberra and Melbourne. The National High Speed Rail network is proposed to be delivered in stages to meet the distinct needs of intercity and regional customers across the east coast and will also require integration with local and regional transport networks. Linking major Australian cities on the east coast with consistent, high capacity trains would provide an alternative to air travel and has the potential to provide significant benefits and economic opportunities along the route.

High-speed rail services can reduce congestion on other modes, such as road and air, provide environmental benefits through lower emissions and can increase access to jobs and businesses for regional communities along the route. World Bank analysis of high-speed rail in China found that it changed patterns of urban development in many cities and led to substantial increases in tourism. High-speed rail also promoted regional economic and macroeconomic development.¹⁰¹

Better connections between regions and cities will support future population growth and unlock economic opportunities. Research by the Australian Housing and Urban Research Institute (AHURI) in 2021 highlighted that connectivity is vital for the economic prospects of regional cities. Metropolitan links, ports, and airports are essential for economic growth, while faster rail connections can provide access to expanded labour markets and stronger business networks. Improvements in regional airport infrastructure, such as Toowoomba’s Wellcamp Airport (Queensland) and Bendigo’s (Victoria) inclusion on Qantas routes, can also deliver tangible benefits.¹⁰²

In its Infrastructure Policy Statement, the Australian Government has flagged its intention to seek investments that ensure the planned development of cities, suburbs and regions, by linking strategic planning, population and employment growth, the supply and availability of housing, and land transport infrastructure investment. Australian Government investments in intercity networks include stage 1 of the Direct Sunshine Coast Rail Line (The Wave) project, Beerburrum to Nambour Rail Upgrade and Logan and Gold Coast Faster Rail in Queensland.

In Victoria, the Australian Government is providing funding to the Western Highway Corridor, the Shepparton Rail Line Upgrades and the recently completed Gippsland Rail Line Upgrade. These investments improve the speed, reliability and capacity of intercity passenger services, strengthen labour market catchments, support regional population growth and reduce pressure on metropolitan transport networks.

The Government has also funded planning and/or investigations on projects such as the Perth to Bunbury Faster Rail in Western Australia, M1 Pacific Motorway – Tweed Heads and Byron Bay Network Improvements in New South Wales, and the Ipswich-Springfield business case in South East Queensland. Early planning ensures future intercity corridors can support projected population growth, preserve critical transport options and safeguard the land needed for long-term network expansion.

Capital cities are expected to continue to house most of Australia’s forecast population growth. However, regional centres close to capitals have also experienced strong population growth. Table 14 contains the top 12 fastest growing non-capital significant urban areas over the past 10 years to 2024, most of which are close to the respective capital city. The table highlights that Geelong, the Sunshine Coast, the Gold Coast, Tweed Heads, and Ballarat are the fastest growing areas, with over 20% growth over the last decade. Of these cities, the Sunshine Coast and Ballarat are over 100 km from the nearest capital city, highlighting the need for intercity connections.

Ensuring strong connectivity between these regional centres and capital cities is important to support and sustain this population growth. Appropriate planning for housing, social infrastructure and digital connectivity will also be critical to supporting liveability in these areas.

Source: Australian Bureau of Statistics (2023-24), Regional Population

As Australia’s population continues to grow in our major cities and regions, intercity connectivity improvements are needed to provide competitive alternatives to air travel and support the efficient movement of people and freight. Targeted investment will improve productivity through better integration of economies and markets, greater competition, and improved access to employment and labour supply. It also aligns with national net zero targets by providing more sustainable transport solutions.

Enhancing intercity rail connections between rapidly growing regional cities and nearby capitals, and between major capital cities, is a national priority. The 2026 Infrastructure Priority List includes the following proposals:

High Speed Rail – Newcastle to Sydney – the proposal for the high-speed rail connection between Newcastle and Sydney is an immediate priority for planning investment to support further analysis of housing objectives, investigations into funding strategies, and improved certainty of costs and benefits. This proposal aims to address connectivity challenges, rapid population growth, and housing pressures through one of Australia’s busiest regional corridors. The proposal is the first stage of a future national high speed rail network.

High Speed Rail – East Coast future stages – the proposal for future high-speed rail inter-city connections on the east coast is identified as a future investment opportunity in the 2-4 year pipeline. These connections would provide a competitive alternative to air travel over some of the world’s busiest flight routes. The proposal supports improved access to housing and labour markets within both regional and metropolitan areas.

Sydney-Canberra rail connectivity – the proposal to improve rail services between Sydney and Canberra is a priority for future investment in the 2-4 year pipeline. Upgrades to the rail connection will improve travel-time reliability for passengers and reduce pressure on the air and road corridor and should integrate with proposed high-speed rail services.