Despite the Hilmer Report of 1993 driving a shift in National Competition Policy, (NCP) from protected, monopolistic government-run services to a more “level playing field” West Australian Local Government Legislation has failed to match this operational change by continuing in 2026 to enable and facilitate Local Government ‘autocratic monopolies’ providing essential services in exclusion of market competition.

Hilmer reforms are reputed to have led to significant economic gains – estimated by the ACCC to have increased average household income by roughly $7,000 so why would Local Government Legislation want to be used to obstruct household benefit?

Hilmer reforms are reputed to have led to significant economic gains—estimated by the ACCC to have increased average household income by roughly $7,000.

• Link to Executive Employee Salaries: Despite some external intervention in regard to setting salary levels, through their legislated powers, local government CEO’s and their senior executives are able to influence both senior employee numbers and their salaries through promoting increased total employee numbers by providing monopoly or ‘sole provider’ services.
• Exclusive Service Delivery Detrimenting Industry Efficiencies: Local Governments like the City of Melville continue as ‘sole providers’ of services like waste management. In the example of waste management services, volume containment within single local government boundaries reduces both interest and ability to invest in efficiencies that could be enjoyed from processing high ‘cross-industry’ volumes. Exclusive service also prevents a customer from transiting to a different supplier where they become dissatisfied with the service provider.
• Lack of Pricing Transparency: Competition transparency in local governments is easily distorted by separating component cost (such as councillor volunteer time) of a delivered service and lumping those costs with ‘whole of organisation’ service’ records. There is often little pressure to adopt ‘full cost pricing,’ leading to potential hidden subsidies or inefficiencies.
• In-House Preference: Local Governments predominantly use their own staff and equipment (in-house teams) regardless of whether a private contractor could do the job better or more cheaply or effectively.
• Use of Employees to Displace Volunteers: While the intention of WA Local Government Legislation states a principal purpose of that Legislation is to encourage community and ratepayer engagement in the business and affairs of their local government, much of the prescription in the legislation facilitates unauthorised power to employees to exclude community and ratepayers by dictating a prejudice to favour employees.

The Hilmer Report (1993)

The Hilmer Report (officially the National Competition Policy (NCP) Review) sought to dismantle these monopolies to improve national productivity. Across Local Government, there is a direct relationship between NCP outcomes and the extent of community engagement in the business and affairs of local government.

• Competitive Neutrality: A core principle required that government businesses (including local governments) should not have a ‘competitive advantage’ over private firms simply because they are government-owned. By using its power to exclude both voluntary services and commercial competition the City of Melville does not provide best available value to its ratepayer community.
• Structural Reform: The NCP recommended restructuring public monopolies to separate the regulatory functions from the commercial service delivery, opening the door for private competitors. The City of Melville failure to separate its commercial services from its regulatory functions is measured in complaints against the City.
• Market Contestability: Introduced concepts like Compulsory Competitive Tendering (CCT), forcing government agencies to allow private companies to bid for work previously held exclusively by the council’s in-house staff. The City of Melville does not identify or disclose all services that could be provided by external enterprises.

Key Comparison

Feature	WA Local Government Act ‘Monopoly’	Competition Policy Hilmer Report
Service Provider	No choice local government only	Consumer choice Private vs. local government
Pricing	Partly hidden or opaque	Full cost pricing Competitive Neutrality
Efficiency Driver	Internal individual managerial power	Market volume competition
Focus	Power and control	Consumer benefit and productivity
Environment	Internal individual managerial power	Community sentiment Public politics
Volunteering	Discourage in favour of employees	Accessible encouraged for consumer benefit