A criticism of the line has been that it cuts Newcastle off from its own harbour foreshore with a number of proposals to close or at least pare it back.

[6] As a proposed solution to this, since 2003 there had been studies to close the line and have Broadmeadow station become the major rail transport hub for the Newcastle region.

This was widely criticised by among others Upper Hunter Region users, and former Deputy Prime Minister and rail enthusiast Tim Fischer.

[10] In December 2012, the New South Wales government announced the line east of Wickham would close to better connect the older CBD to the water front precinct of Honeysuckle.

[14][15][16] A short section of the corridor east of Wickham was incorporated into the Newcastle Light Rail, which generally follows a parallel route to the railway line along Hunter and Scott Streets and serves as its replacement.

On 16 September 2014, the opposition and crossbench parties in the NSW Legislative Council successfully moved for a select committee to inquire into the planning process in Newcastle and the broader Hunter region.

The inquiry held three public hearings in November 2014; some evidence was given of dealings with owners of land parcels near the railway who did not disclose their interests.

[22] The chairman of the committee requested the NSW government to defer the railway's closure, scheduled for 25 December 2014, until his inquiry had considered the submissions and evidence and made its report.

[24] On 18 December 2014, the inquiry released an interim report containing eight recommendations, including that no steps be taken to remove existing rail infrastructure until more planning work had been undertaken.

[27] On 9 September 2015, the 'Transport Administration Amendment (Closure of Railway Line at Newcastle) Bill 2015' was introduced into the NSW parliament lower house by Transport Minister Andrew Constance.