Competitive neutrality is the principle that public sector businesses should compete with private sector businesses on an equal (competitively neutral) basis, and that public sector businesses should not have a competitive advantage (or disadvantage) over the private sector solely due to their government ownership.
Competitive neutrality is important to ensure effective competition between public sector and private sector businesses. Where government business activities have unfair advantages, this can promote inefficient production and pricing practices, that can result in an excess flow of resources to the public sector. This may limit the resources that are available to the private sector and can increase the overall costs of providing services to the community.
Competitive neutrality is intended to make the true costs and level of performance of government businesses transparent. It can facilitate better decisions regarding the businesses’ operation. Competitive neutrality can also promote productivity gains, which will flow to consumers and industry in the form of better services and lower prices.
We are responsible for:
- advising government agencies about complying with the principle of competitive neutrality
- receiving, investigating and reporting on complaints about the alleged failures of government agencies to comply with the principle of competitive neutrality.
We can investigate competitive neutrality complaints relating to relevant state and local government businesses. More information about competitive neutrality, including how to make a complaint, appears on our competitive neutrality page.