Are they really suggesting that trams would be introduced into George Street?
This is Sydney City Council making the suggestion. It is an idea that O'Farrell made an election promise to investigate too.
If buses are running across the CBD "empty", as the SCC suggests, then they must be setting down passengers in the CBD and collecting passengers elsewhere in the CBD. If the buses were made to bypass the CBD, those passengers presumably would be forced to find alternative transport to reach the CBD. Unless the proposal includes multiple bus interchanges along the Cahill Expressway (at least one of which provides easy interchange with Circular Quay wharves and station), the idea just inconveniences buses for the sake of private transport.
People from the northern beaches will continue to need buses into the CBD rather than trams, until a tram line crosses the Bridge once more. If such a line were built, it would need to reach some decent population centres on the shoreline (not terminate at the intersection with Military Road). I'm thinking Dee Why or Collaroy.