In 1992, an independent committee of inquiry, the National Competition Policy Review Committee, was established by Prime Minister Paul Keating to inquire into and advise on appropriate changes to legislation and other measures in relation to the scope of the Trade Practices Act 1974 and the application of the principles of competition policy.
The report was commissioned against a backdrop of major microeconomic reforms led by the Keating Government, but slow progress on areas of the economy sheltered from competition as a result of constitutional limits on the application of the Federal Trade Practices Act or of other actions by Federal or state governments.
The recommended changes to the Trade Practice Act were implemented quickly, and the report was also used as the basis of the Competition Principles Agreement reached at the 1995 meeting of the Council of Australian Governments (COAG).
The objective of competitive neutrality policy is the elimination of resource allocation distortions arising out of the public ownership of entities engaged in significant business activities: Government businesses should not enjoy any net competitive advantage simply as a result of their public sector ownership.
That contributed to a hostile public reaction[dubious – discuss], which was particularly evident in support for Pauline Hanson's One Nation party in the 1998 Queensland election.