This is why I am the Premier.

— Morris Iemma, late 2007
Journalist Simon Benson describes a crucial meeting in late 2007 between Iemma and Labor state president Bernie Riordan during the height of the furore over electricity privatisation:
[Iemma] had laid out on his desk a spreadsheet of infrastructure projects … On the bottom half were all the projects the state needed if it was to avoid choking on its own congestion within the next decade.
It amounted to more than $25 billion.
And that was what they hadn't even announced.

"This is why I am the Premier," he told Riordan, emphasising his belief that it was critical for the privatisation to succeed. "…
These [projects] need to be done.
I need to do these."

From the beginning of his turbulent three-year stint as premier, Iemma recognised that the cautious, managerialist character of the Carr government was not sustainable – in policy or political terms.

Public transport was perhaps the most stark example of Carr's inaction.
The issue, Iemma assured voters, was "my highest priority ... I hear and understand the frustrations of commuters and am determined to drive improvements."

The smooth-running Olympic transport arrangements had been a triumph for Carr, and so former Olympic Co-ordination Authority head Professor David Richmond was the natural choice to head up a powerful new infrastructure development unit within the Premier's Department.
One of the unit's recruits was transport planner and future Sydney Metro director Rodd Staples.

The state's transport problem was threefold.
First, the existing rail system was expensive to run, not least because the operator, RailCorp, remained tied to old-style industrial practices and excessively high engineering standards.
Delivering MREP would lock in these inefficiencies.
Second, even if costs could be brought under control, the sheer scale of investment required to extend an all-purpose heavy rail system was beyond the state's means.
Put simply, MREP was unaffordable in its current form.
Third, while the need for additional extensions into the new bus and car-dependent suburbs of the north-west and south-west was clear – and would be aided by the partial preservation of corridors in the past – congestion at the existing Town Hall and Wynyard stations meant that to work, any new rail project had to increase capacity in the CBD.
Yet there was little electoral advantage to be gained from digging new rail tunnels under safe seats in the lower North Shore and CBD.

The unit's solution – supported by Iemma and Costa – was to sidestep the high costs and industrial risks of the existing RailCorp network and instead begin building a new rapid transit rail system in parallel.
The new system would incorporate smaller, lighter rolling stock, reducing construction costs, and be operated by the private sector, reducing operating costs.
But despite the savings available via the rapid transit option, the costs were still beyond the state's means.

To prepare the ground for the day when the funding became available, the idea was trailed in the 2006 Urban Transport Statement, though no commitments were made.
This is why I am the Premier.
— Morris Iemma, late 2007
Journalist Simon Benson describes a crucial meeting in late 2007 between Iemma and Labor state president Bernie Riordan during the height of the furore over electricity privatisation:
[Iemma] had laid out on his desk a spreadsheet of infrastructure projects … On the bottom half were all the projects the state needed if it was to avoid choking on its own congestion within the next decade. It amounted to more than $25 billion. And that was what they hadn't even announced.
"This is why I am the Premier," he told Riordan, emphasising his belief that it was critical for the privatisation to succeed. "… These [projects] need to be done. I need to do these."
From the beginning of his turbulent three-year stint as premier, Iemma recognised that the cautious, managerialist character of the Carr government was not sustainable – in policy or political terms.
Public transport was perhaps the most stark example of Carr's inaction. The issue, Iemma assured voters, was "my highest priority ... I hear and understand the frustrations of commuters and am determined to drive improvements."
The smooth-running Olympic transport arrangements had been a triumph for Carr, and so former Olympic Co-ordination Authority head Professor David Richmond was the natural choice to head up a powerful new infrastructure development unit within the Premier's Department. One of the unit's recruits was transport planner and future Sydney Metro director Rodd Staples.
The state's transport problem was threefold. First, the existing rail system was expensive to run, not least because the operator, RailCorp, remained tied to old-style industrial practices and excessively high engineering standards. Delivering MREP would lock in these inefficiencies. Second, even if costs could be brought under control, the sheer scale of investment required to extend an all-purpose heavy rail system was beyond the state's means. Put simply, MREP was unaffordable in its current form. Third, while the need for additional extensions into the new bus and car-dependent suburbs of the north-west and south-west was clear – and would be aided by the partial preservation of corridors in the past – congestion at the existing Town Hall and Wynyard stations meant that to work, any new rail project had to increase capacity in the CBD. Yet there was little electoral advantage to be gained from digging new rail tunnels under safe seats in the lower North Shore and CBD.
The unit's solution – supported by Iemma and Costa – was to sidestep the high costs and industrial risks of the existing RailCorp network and instead begin building a new rapid transit rail system in parallel. The new system would incorporate smaller, lighter rolling stock, reducing construction costs, and be operated by the private sector, reducing operating costs. But despite the savings available via the rapid transit option, the costs were still beyond the state's means.
To prepare the ground for the day when the funding became available, the idea was trailed in the 2006 Urban Transport Statement, though no commitments were made.
Sydney Metro (2008 proposal)