Yes, it’s financially viable for NSW to make public transport free, but it’s a $1–1.5 billion per year decision that only makes sense if it’s tied to a clear climate, congestion, and equity strategy—not just a vibes‑based “free stuff” policy.

Below is a simple, NSW‑specific, costed model you can actually stress‑test.

1. Baseline: what fares currently bring in

Public data suggests that:

• Total passenger revenue (fares etc.) for NSW public transport is on the order of $1–1.5 billion per year (buses, trains, light rail, ferries combined). This is consistent with the scale implied by NSW Parliamentary Budget Office (PBO) costings for Opal changes, where a modest 20% reduction in the weekly Opal cap for just over a year costs about $68.8 million in forgone revenue. Parliament of NSW
• Transport for NSW’s total expenses are many times larger than fare revenue—fares cover only a minority share of operating costs, with the rest already subsidised by government. Transport for NSW Parliament of NSW

Working assumption for a clean model: 
Use $1.3 billion/year as an indicative figure for fare revenue forgone if all Opal‑covered services were made free.

2. Simple “full free fares” model for NSW

Policy: 
All Opal fares set to $0 for 12 months on Sydney Trains, NSW TrainLink (Opal legs), buses, light rail, and Sydney Ferries (excluding airport access fees and special services).

Direct budget impact (per year):

• Lost fare revenue: ≈ $1.3 billion
• Admin/IT changes: one‑off $20–40 million (back‑end Opal changes, comms, signage, etc.)—tiny compared to the revenue hit.
• Induced demand operating cost:
  • If ridership rises 10–20%, you likely need extra peak services on some corridors.
  • Rough ballpark: $100–200 million/year in extra operating costs (fuel/electricity, staff, maintenance).

Total annual cost envelope: 
≈ $1.4–1.5 billion per year (lost revenue + extra services), after initial IT/admin setup.

3. How big is that in NSW budget terms?

From Transport for NSW financial statements:

• Total transport‑cluster spending (roads + public transport + infrastructure) is tens of billions per year. Transport for NSW Parliament of NSW
• Major road projects routinely run into multiple billions each (WestConnex, Western Harbour Tunnel, etc.).

So:

• $1.4–1.5 billion/year is large, but not absurd—it’s in the same ballpark as:
  • One big toll‑road subsidy or
  • A couple of mid‑sized road projects spread over several years.

In other words, NSW can afford it, but only by choosing it over other big‑ticket items.

4. A realistic funding mix

Here’s a plausible way to cover ≈$1.5b/year without blowing the budget:

• Reallocate from new road capacity projects:
  • Slow or cancel 1–2 major road expansions, freeing $500–700 million/year in capital/program funding.
• Congestion/parking pricing in inner Sydney:
  • CBD congestion charge + higher on‑street parking fees could raise $200–400 million/year, while reinforcing mode shift.
• Targeted cut to fuel or vehicle subsidies:
  • Reducing or removing selected road‑user subsidies could yield $200–300 million/year.
• General revenue / budget reprioritisation:
  • The remaining $200–400 million/year comes from general revenue, framed as a climate + cost‑of‑living measure.

You end up with a coherent story:
“Less money on inducing car traffic, more on free, frequent public transport.”

5. Emissions and car‑use impact (order of magnitude)

This is where it gets interesting.

• If free fares + service upgrades shift even 5–10% of car trips in Greater Sydney to public transport, that’s a material cut in transport emissions and congestion.
• The exact number depends on:
  • How aggressively you improve frequency and reliability
  • Whether you remove road capacity or price driving (otherwise induced demand eats some gains)

On its own, free fares might only deliver a modest mode shift.
But free + better + faster + driving made less attractive can be a serious climate lever.

6. Two cheaper variants if “full free” is too much

If $1.5b/year is politically heavy, you can stage it:

Variant A: Off‑peak + weekends free

• Policy:
  • $0 fares after 7pm weekdays, all day weekends, and public holidays.
• Cost:
  • Likely 30–40% of full fare revenue → ≈ $400–600 million/year forgone.
• Upside:
  • Big equity and cost‑of‑living win
  • Encourages non‑work trips to shift from car to PT
  • Less pressure on peak capacity

Variant B: Free for concessions + youth + low‑income

• Policy:
  • $0 fares for Health Care Card holders, pensioners, students, and under‑25s.
• Cost:
  • Depending on take‑up, maybe $300–500 million/year in forgone revenue.
• Upside:
  • Highly targeted social wage
  • Strong access benefits for education, job‑seeking, and health
  • Easier political sell than universal free fares

Both variants can be stepping stones to full free fares if they prove popular and effective.

7. Is it “too expensive” as a social wage?

It’s only “too expensive” if:

• NSW insists on keeping all current road projects and subsidies, and
• Refuses to introduce any form of congestion or parking pricing.

If you treat free public transport as:

• a core climate tool,
• a cost‑of‑living measure, and
• a city‑shaping strategy,

then $1–1.5 billion/year is big but defensible—especially compared to what NSW already spends to keep people driving.

If you want to go another level down, we can:

• build a rough per‑mode breakdown (rail vs bus vs ferry), or
• design a “Free PT in 3 stages over 6 years” roadmap that a real government could actually run on.