qdts-camping-options-toolkit

Competitive neutrality
Fact sheet D
Competitive neutrality
With the objective of improving the efficiency and
productivity of the Australian economy, all Australian
governments have agreed to adopt a number of
competition initiatives with respect to government
business activities, known collectively as the National
Competition Policy.
Competitive neutrality is a key element of this policy.
It requires public sector business activities that are
in competition with the private sector to not have
competitive advantages or disadvantages simply by virtue
of their government ownership or control. The advantages
that government business activities may have include the
absence of:
• full federal or state taxes or tax equivalent systems
• debt guarantee fees directed towards offsetting the
competitive advantages of government guarantees
• procedural or regulatory requirements of the federal,
the state or a local government on conditions
equivalent to the conditions to which a competitor
or potential competitor may be subject, including,
for example, requirements about the protection
of the environment and about planning and
approval processes.
Competitive neutrality does not extend to competitive
advantages or disadvantages arising from factors such as
business size, skills, location or customer loyalty.
Administration of competitive neutrality
in Queensland
The two agencies with primary responsibility for the
administration of competitive neutrality in Queensland
are the Queensland Competition Authority (QCA) and
Queensland Treasury.
Queensland Treasury is responsible for overseeing
the application of competitive neutrality principles to
Queensland Government business activities as is required
in Clause 3 of the Competition Principles Agreement.
Clause 3 of the agreement requires each local government
to consider applying competitive neutrality principles to
its significant business activities where it can demonstrate
the benefits to the community would outweigh the costs.
In addition, under the Local Government Act 2009, local
governments are required to establish appropriate
processes for dealing with competitive neutrality
complaints about their relevant business activities. A
complaint can be made to either the local government
or the QCA.
The role of the QCA in the area of competitive neutrality
is twofold:
• To accept and, if considered warranted, investigate
complaints that the significant business
activities of state government agencies, and
certain local government business activities,
enjoy competitive advantage over competitors
or potential competitors. The results of any
investigation or consideration are to be reported
to relevant ministers or local governments for their
consideration.
• To accredit certain state and local government
business activities as complying with the principle
of competitive neutrality, for a period of up to
2 years. Provided accredited agencies maintain the
terms of their accreditation and continue to comply
with the principle of competitive neutrality for the
period they have been granted accreditation, they
have an effective defence against complaints.
The core requirements for local government and state
government competitive neutrality are the same.
Competitive advantages or disadvantages due to
government ownership need to be addressed to
establish a level playing field between government
and non-government businesses.
The role of Queensland Treasury is to investigate
competitive neutrality complaints made against
Queensland Government significant business activities
that are outside the QCA’s jurisdiction.
Regulatory framework—Queensland
Government business activities
With regard to competitive neutrality, the Queensland
Competition Authority Act 1997 outlines:
• the definition of competitive neutrality
• the means by which Queensland Government
business activities become subject to oversight by
the QCA for compliance
• the processes and powers that govern the QCA’s
investigations
• the responsibilities of the Premier and Treasurer in
considering the recommendations of the QCA.
Once the Premier and Treasurer declare the business
activities of certain agencies for the purposes of
compliance, these activities are gazetted, and complaints
against them may be received by the QCA. Subject
to certain criteria, the QCA can then investigate the
complaint. Ministers consider the recommendations of the
QCA and, within 30 days, issue a decision notice, which
must outline the reasons for that decision.
Fact sheet D
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