Provision of public services by state governments rather than municipalities is considered an important urban governance factor preventing deeper levels of socio‐spatial inequality in Australian cities. The paper examines the spatial patterns of investment by the New South Wales state government in a wide range of services and infrastructure in metropolitan Sydney over 28 budget years from 1988/89 to 2015/16. We examined the relationship between volume and type of investment in infrastructure and services, and considered a local area's socioeconomic characteristics, distance from the central business district, and designation as a strategic site in metropolitan plans. Despite an overall redistributive approach favouring relatively disadvantaged areas, the most disadvantaged suburbs in metropolitan Sydney had significantly lower levels of investment. When funding was directed to the most disadvantaged suburbs, it was often in the form of new social housing development, reinforcing both the concentration of poverty and disadvantage in resource access. The findings suggest that this is a case of under‐investment by the state government in areas already populated by disadvantaged communities rather than a market‐driven process whereby disadvantaged households move into poorly resourced neighbourhoods.