The competition watchdog is urging governments to sell assets to boost national productivity.

The Australian Competition and Consumer Commission chairman Rod Sims says the root and branch review of competition policy by the Federal Government should be as broad as possible, as privatisation and more competitive markets offer the best possibility of productivity improvements.

Mr Sims says, for a start, state governments should privatise energy companies, a move he believes will bring down electricity prices.

"When the private sector owns assets that does provide better incentives for better performance," he told ABC's News Radio.

"I did comment on the energy sector, which is a sector I know fairly well. I'm quite confident that had the network assets in NSW and QLD been owned by the private sector we'd probably have lower electricity prices than we do now."

An article in this morning's Australian Financial Review, based on an interview with Mr Sims, says that he has called for Federal Government to sell Medibank Private and Australia Post.

Space to play or pause, M to mute, left and right arrows to seek, up and down arrows for volume. Listen Duration: 5 minutes 7 seconds 5 m ACCC chairman Rod Sims discusses privatisation with News Radio's Marius Benson ( Marius Benson ) Download 2.3 MB

However, Mr Sims has told News Radio that he was not advocating for the sale of particular Government-owned businesses.

"Australia Post, that's really an issue for government, I was making a general point this morning, and I'll really leave it at that," he told News Radio's Marius Benson.

"I think there are direct experiences you can draw from the energy sector, but I've really got no parallel from which to comment on Australia Post, or Medibank Private for that matter."

Mr Sims adds, however, that the only good reason for government ownership is because it has particular social objectives in mind.

"If all you're after is maximum efficiency then there's no question that you'd have those assets owned by the private sector," he argued.

"If you're continuing to own them by government, then that's because you've got some social objective to achieve.

"If you have a social objective, it's worth specifying what that is, and I suspect there's probably more direct ways to achieve that social objective."

'Fat removed'

The union that represents postal workers has rejected Mr Sims's arguments around efficiency, saying that Australia Post has become "lean and mean" since being corporatised in the 1980s.

"Any fat that existed in the organisation has long since been removed, our members have delivered untold productivity gains over the past 20 years," said Martin O'Nea, the national assistant secretary of the Communication Workers Union.

"There may be some fat within Australia Post that may be up the top of the organisation - the CEO's remuneration this year went from $2.8 million to $4.7 million.

"But, regarding the corporation as a whole, we see it as a pretty lean, mean fighting machine and probably the world's best postal service."

Mr O'Nea says Australia Post has also returned more than $800 million in dividends to taxpayers over the past three years.

He also warns that Australia Post's less profitable but socially useful services, such as relatively affordable and timely mail and parcel deliveries to rural and regional Australia, would likely suffer if it was privatised.

"With a privatised Australia Post, would them services that people have seen in the past three years remain the same?" Mr O'Nea asked rhetorically.

"We'd venture that the experience that regional and rural Australia have had with privatisation in the past would leave them to believe that it certainly wouldn't."

That is a view shared by the Post Office Agents Association Limited, which represents the owners and operators of licensed post offices, which make up around 75 per cent of Australia Post's network.

"A privatised postal operator would focus on the main population centres at the expense of customers in rural Australia," said its chief executive Ian Kerr.

The association says it received assurances from both major parties ahead of last year's federal election that neither had plans to privatise Australia Post.

The Government has launched a scoping study into the possible sale of Medibank Private, which is due to report next month.