A reformed National Competition Policy can unlock innovation, streamline regulations, drive ‘digital by default’ and pave the way for a net zero transformation.

On 1 December 2023, Australia’s treasurers agreed to revitalise the National Competition Policy, committing to develop a long-term pro-competitive reform agenda through the Council on Federal Financial Relations.

The original National Competition Policy, established in 1995, underpinned an ambitious reform agenda that modernised Australia’s economy, strengthening its resilience in the face of global economic change through the late 1990s and 2000s.

We now need substantial changes to competition policy to support a cost-effective net zero transition, embrace the opportunities of the digital economy and the growth in human services, enhance consumer wellbeing, and support Australia’s most vulnerable.

“The review of the National Competition Policy is an important opportunity for us to re-prosecute for the changes we want, but this time through a distinct competition lens. Our reforms can unlock greater productivity, promote innovation and choice, and restore balance to the contractual relationships across procurement supply chains,” says Consult Australia’s Head of Policy and Government Relations, Kristy Eulenstein.

Consult Australia is supportive of the National Competition Policy Principles and National Competition Policy Reform Agenda, and has made 16 recommendations across these five themes:

• Regulatory complexity and impost  
• Regulatory inconsistency
• Market behaviours impacting competition
• Innovation and industry involvement
• Digital by default.

“Our recommendations not only go to making regulatory systems streamlined and effective, they also seek to enable and encourage the widest variety of businesses to participate in the market,” Kristy says.

“The key challenge for the federal government’s reform agenda will likely be the buy-in from all government agencies at both the federal and state levels,” Kristy adds. 

For instance, Consult Australia recommends that the National Competition Policy include an explicit requirement for all governments to consider small business impacts, market conditions and competition impacts when developing regulatory policy. 

“Many of our recommendations need action by all or most state governments. This barrier is not insurmountable and will be worth the effort to increase competition and boost productivity for both government and industry,” Kristy concludes.

Download Consult Australia’s Revitalising National Competition Policy submission to Treasury.