And Mr Foley is also calling on the state government to restore direct rail services from central Sydney to Olympic Park, while complementing new housing developments with the restoration of some existing industrial and commercial land.

The proposals by Mr Foley come as the government continues to delay announcing where it wants to build a light rail line around Parramatta, to the anxiety of the city's new independent lord mayor.

In a speech, made to advocacy group the Committee for Sydney, the Labor leader said the new Greater Sydney Commission should be in charge of developing the area around Olympic Park as well as the land around a Badgerys Creek airport.

"I am not a NIMBY [Not In My Backyard]," said Mr Foley, also the member for the adjoining seat of Auburn.

"I am an opponent of urban sprawl," he said. "Density done well is the key to the future liveability of Sydney."

But he said the government had, so far, not done enough to complement new housing development precincts at Wentworth Point and Lidcombe with useful infrastructure.

One way to help remedy this would be by allowing the Greater Sydney Commission, a new body set up to coordinate planning through the city, to take over the corridor.

Currently a number of authorities control aspects of planning in the region, including Auburn and Parramatta councils, the Sydney Olympic Park Authority, the Department of Planning, Sydney Motorway Corporation and Transport for NSW.

"I must say that trusting the characters who make up the Auburn Council with any responsibility for one of the most important precincts in Australia's global city is a triumph of astounding optimism over lived experience," Mr Foley said.

He also proposed road improvements for what has been described as Sydney's worst roundabouts and the restoration of direct rail services to Sydney Olympic Park.

The corridor also includes the former industrial lands at Camellia, which have been slated for the development of 20,000 high rise apartments. But Mr Foley said the Camellia development should not include only housing. "I want to see industrial and commercial land preserved along the corridor at places like Camellia to ensure we get the balance right between residential and commercial growth," he said.

The government, meanwhile, continues to study four potential light rail routes around Parramatta. Former Transport Minister Gladys Berejiklian announced these studies a year ago, saying she "envisaged" construction to start on one within the next term of government.

Since then the government has said it would commit $1 billion to the line and also said that it expects to partly fund the line through "value capture", a model of public financing that aims to recover the windfall that land owners get from public infrastructure.

Parramatta lord mayor Paul Garrard, meanwhile, said the decision about where the line would run had been slow and it would become difficult to plan the growth of the city without certainty about the light rail route.

"We need to know very shortly what's going on so we can plan the big picture ... You want to stop the talk and do the walk," said Cr Garrard, who said the delays had made him "anxious".

Projects such as the $2 billion Parramatta Square, the proposed transformation of industrial Camellia into a new residential suburb, the redevelopment of Westmead Hospital and the location selected for the Powerhouse Museum and the construction of the new Parramatta Stadium, would be affected to varying extents by the choice of light rail route.

The Prime Minister, Malcolm Turnbull, this week said he was keen to explore more ways of using value capture to pay for more public transport projects. Mr Turnbull committed $95 million for an extension of a light rail line on the Gold Coast, reversing former Prime Minister Tony Abbott's refusal to fund the project.