Public Benefits Test - Doone Kennedy Hobart Aquatic Centre

Engagement on this project has now concluded. Thank you to everyone who participated in the feedback process. We will report back here soon with the results of the engagement.


The Doone Kennedy Hobart Aquatic Centre (DKHAC) has been the subject of a competitive neutrality complaint lodged with the Office of the Economic Regulator (OTTER).

The competitive neutrality framework is to ensure publicly owned and private businesses compete on equal terms.

The aquatic centre provides a number of services including gymnasium and personal training, memberships that provide access casual swimming, various learn to swim programs, along with a cafeteria, retail area and hosting of swimming and other aquatic events.

These activities can compete with private sector providers, so it is important that council comply with Competitive Neutrality Principles.

The DKHAC pricing for some services – lap swimming and membership – is significantly lower than what the Complainant must charge to cover all operating costs and this is affecting their memberships and patronage.

In its investigation of the Complaint, OTTER came to the following conclusions:

    • The Council has recognised the DKHAC as a Significant Business Activity (SBA), but full cost attribution has not been applied to the pricing of the services.
    • National Competition Policy (NCP) allows the Council to charge less than full costs in order to meet Community Service Obligations (CSO).
    • NCP also allows the Council to charge less than full cost, if it can be demonstrated, through a robust and independent public benefits assessment that it is in the public benefit that the service is offered at prices that are below full cost.

An independent review conducted by accounting firm KPMG showed the council must establish and provide advice on those services/activities where there may be a Community Service Obligation or undertake a Public Benefit Test to demonstrate that there is a net public benefit in not applying full costs.

The advice received was that the lap swimming and membership services are required to be justified as a part of a Public Benefits Test.

What is a public benefit test?

The Department of Treasury and Finance’s guidelines on public benefit tests for local governments outlines when and why public benefit tests are required, what the public benefit test comprises and how it should be conducted.

According to the guidelines, an activity can be described as having a public benefit, if on the whole, it can be demonstrated that the benefits it provides to the community, outweigh the costs of the activity to the community.

The public benefit assessment should be undertaken in consultation with the community, including affected businesses that would be adversely affected by unfair competition, through an open and transparent process.

Have your say

To inform this public benefit test the City is now seeking feedback on DKHAC's provision of lap swimming and membership services.

To share your feedback we encourage you to:

Submissions close midnight Sunday 11 December 2022.

Please note: All feedback collected will be managed in accordance with the City of Hobart's Privacy Policy(External link). Any submissions received will be reviewed by KPMG and form part of the public benefit test process.

Engagement on this project has now concluded. Thank you to everyone who participated in the feedback process. We will report back here soon with the results of the engagement.


The Doone Kennedy Hobart Aquatic Centre (DKHAC) has been the subject of a competitive neutrality complaint lodged with the Office of the Economic Regulator (OTTER).

The competitive neutrality framework is to ensure publicly owned and private businesses compete on equal terms.

The aquatic centre provides a number of services including gymnasium and personal training, memberships that provide access casual swimming, various learn to swim programs, along with a cafeteria, retail area and hosting of swimming and other aquatic events.

These activities can compete with private sector providers, so it is important that council comply with Competitive Neutrality Principles.

The DKHAC pricing for some services – lap swimming and membership – is significantly lower than what the Complainant must charge to cover all operating costs and this is affecting their memberships and patronage.

In its investigation of the Complaint, OTTER came to the following conclusions:

    • The Council has recognised the DKHAC as a Significant Business Activity (SBA), but full cost attribution has not been applied to the pricing of the services.
    • National Competition Policy (NCP) allows the Council to charge less than full costs in order to meet Community Service Obligations (CSO).
    • NCP also allows the Council to charge less than full cost, if it can be demonstrated, through a robust and independent public benefits assessment that it is in the public benefit that the service is offered at prices that are below full cost.

An independent review conducted by accounting firm KPMG showed the council must establish and provide advice on those services/activities where there may be a Community Service Obligation or undertake a Public Benefit Test to demonstrate that there is a net public benefit in not applying full costs.

The advice received was that the lap swimming and membership services are required to be justified as a part of a Public Benefits Test.

What is a public benefit test?

The Department of Treasury and Finance’s guidelines on public benefit tests for local governments outlines when and why public benefit tests are required, what the public benefit test comprises and how it should be conducted.

According to the guidelines, an activity can be described as having a public benefit, if on the whole, it can be demonstrated that the benefits it provides to the community, outweigh the costs of the activity to the community.

The public benefit assessment should be undertaken in consultation with the community, including affected businesses that would be adversely affected by unfair competition, through an open and transparent process.

Have your say

To inform this public benefit test the City is now seeking feedback on DKHAC's provision of lap swimming and membership services.

To share your feedback we encourage you to:

Submissions close midnight Sunday 11 December 2022.

Please note: All feedback collected will be managed in accordance with the City of Hobart's Privacy Policy(External link). Any submissions received will be reviewed by KPMG and form part of the public benefit test process.

Page last updated: 27 Feb 2023, 11:25 AM