Prime Minister Anthony Albanese says stopping development on flood plains, especially in western Sydney, will go a long way towards saving communities already reeling from multiple natural disasters.
"The obvious answer is to stop development on flood plains," he said on Friday.
Saturday is set to be a high-risk day for Sydney with warnings of renewed river flooding to the city's west, months after record peak levels.
Sydney is experiencing its wettest year on record as widespread rain and thunderstorms put large parts of NSW on flood alert.
The rain gauge at Sydney's Observatory Hill on Thursday passed 2200 millimetres recorded this year, breaking the annual rainfall record of 2194mm set in 1950.
The SES warned people near Penrith to stay informed about predicted river rises in the Nepean, Hawkesbury and their tributaries.
"We need to take flood and other extreme weather events into account when planning infrastructure investments," Mr Albanese said in his speech at the Western Sydney Leadership Dialogue.
Mr Albanese also took aim at NSW Premier Dominic Perrottet's plans to raise the Warragamba Dam wall to protect communities on the Nepean and Hawkesbury flood plain.
He said the "economic case" for the costly exercise needs to be made.
In his first address to Greater Western Sydney since becoming prime minister, Mr Albanese said the October 25 budget will see funding for critical projects in the region.
These include the Western Sydney Airport due to open in 2026 and an accompanying rail line from the city centre, to which the federal government will contribute more than $5 billion.
"We will make sure we do what we can to help families with their cost of living, in a way that doesn't push up inflation or add pressure to demand," he said.
He pledged his government's priority "is an economy that works for people, not the other way around".
Cheaper child care would benefit more than 20,000 families in the region and provide a more equitable economy, he said.
"We are prepared to make difficult decisions, to get Australia through hard times".
"Our budget will be responsible," Mr Albanese added.
The dialogue and its patrons pledged their support for an Indigenous voice to parliament, presenting a letter to Mr Albanese on Friday.
Greater Western Sydney is home to one of the country's largest Aboriginal and Torres Strait Islander populations.
Mr Albanese said voting yes to the voice referendum scheduled tentatively for July 2023 would "uplift the entire nation".
"We're going to be a much better country ... when we get it done".
