An Analysis of the Relative Efficiency of Wastewater Utilities in Non-Metropolitan New South Wales and Victoria (Report‪)‬

1. INTRODUCTION Several recent inquiries into Australian local government have claimed that a general degree of managerial incompetence, especially in asset management, coupled with conflict-riddled elected councils and concomitant policy deadlock can partly explain the perilous state in which the sector now finds itself (see, for instance, Allan (2006) and Dollery et al. (2007)). It follows that reform of local council governance arrangements to better reflect corporate-style managerial structures may represent a partial solution to these problems in contemporary Australian local government. First, the highly-skilled managers may be more willing to consider a career in local government if common managerial techniques applied in both the public and private sectors. Second, less scope for ongoing political interference by elected councillors in the management of local public service delivery may provide some comfort to those more accustomed to profit maximization goals. This begs the question as to the role of governance arrangements in the relative efficiency of public sector enterprises. If a corporate-style structure can be shown to lead to greater efficiency, then wholesale reform of local government service delivery arrangements may be warranted.