NSW Premier Barry O'Farrell has been urged to reconsider his position on a second Sydney airport to ensure the prosperity of both the city and Australia as a whole.
Mr O'Farrell has vowed a second airport will not be built in Sydney under his coalition government because the community is already suffering from aircraft noise, News Ltd reported on Friday.
The federal government responded to the report by warning the premier that he risked putting a "handbrake" on Sydney's productivity.
Federal Infrastructure and Transport Minister Anthony Albanese said Mr O'Farrell needed to read a joint report by NSW and commonwealth government representatives, which found there was an "absolute need" for a second airport.
"Sydney needs a second airport sooner rather than later," Mr Albanese told reporters in Sydney.
"We know that just 10 years ago more than half the international flights came to Sydney.... That figure has fallen below 40 per cent.
"This is a handbrake on the nation's productivity and it particularly is a handbrake on Sydney."
Mr Albanese said a second airport was vital for the continued growth and prosperity of NSW but the commonwealth did not have the power to force the state government's hand.
The failure to increase the state's air traffic capacity through a second airport will have knock-on effects for the whole country, the minister warned.
The federal government has power over aviation activities but needs the state government on board.
"You can't operate an airport without operating the land transport and planning issues around that airport," Mr Albanese said.
"We require the co-operation of NSW."
Foreign Minister Bob Carr also called for a bipartisan approach to send a message to investors.
"A second airport is such a massive piece of infrastructure. I think a bipartisan approach commends itself," the former NSW premier told reporters outside his home at Maroubra, in Sydney's east, which is under a flight path.
"I'd like to see both levels of government, both sides of politics, get together and have a common position on a second airport.
"A second airport is inevitable."
Mr O'Farrell wants Canberra airport expanded to handle international flights with a high-speed rail link to Sydney, which Senator Carr said should be considered.
"There has been a report that looked at that and found that the passenger loads at either end weren't enough to render it viable without a very big level of government subsidy," Senator Carr said.