Federal funding for a $20 billion-plus metro rail line between Parramatta and the Sydney CBD should form the core of a new focus on a crucial swathe of suburbs in the centre of the city, according to a report released on Thursday.

The report calls for a sweeping overhaul of the structures governing the region stretching from Castle Hill to Hurstville to better coordinate the delivery of major infrastructure projects, including new transport routes, sporting facilities, hospitals, universities and the future Powerhouse Museum.

A new report calls for a sweeping overhaul of the structures governing Sydney's urban development. Credit:AdLib

It emphasises the importance of those middle ring suburbs such as Parramatta, Bankstown and Burwood that are not part of the established inner-city, but are also not receiving the billions in investment associated with a new Western Sydney Airport.

The "Stuck in the Middle" report, authored by the Western Sydney Leadership Dialogue, said the region was home to 1.5 million Sydneysiders and was expected to accommodate 50 per cent of the city's population growth over the next 20 years.