Why customer experience in local government matters more than ever

Why CX matters in local government

Customer experience in local government is not about making interactions pleasant. It is about trust. When residents can get what they need quickly, easily and with dignity, they trust their council more. They engage more. They are more willing to participate in consultations, more forgiving when things go wrong, and more likely to support the decisions that affect their community.

The reverse is also true. Poor experiences erode trust in ways that no communications campaign can fully repair. And unlike the private sector, councils cannot lose customers to a competitor. They lose something harder to rebuild: legitimacy.

This is why The Strategy Group has been tracking CX maturity in Australian local government for two years through the CX Maturity Index.

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What is the CX Maturity Index?

The CX Maturity Index (CXMI) is a national benchmark that measures customer experience capability across 10 dimensions, grouped into CX Drivers and CX Enablers. Councils receive a score from 0 to 5, placing them on a five-level maturity scale from Basic through to Leading:

Level 1 - Basic: CX efforts are informal and unstructured, no CX strategy, governance or measurement in place.

Level 2 - Reactive: Some CX awareness exists, but efforts are reactive, inconsistent and undocumented.

Level 3 - Intermediate: CX is recognised as important, with emerging processes, but execution is uneven across the organisation.

Level 4: Proactive: CX is strategically embedded with defined governance, consistent measurement, and cross-functional collaboration.

Level 5: Leading: CX is a core organisational capability with continuous innovation, predictive insights, and exemplary customer outcomes.

This year, 46 councils from across Australia participated, spanning NSW, Victoria, Western Australia, South Australia and Queensland, and covering metro, regional and rural council types. The findings give us the most comprehensive picture yet of where local government CX stands.

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What the 2026 findings reveal

The headline number: the national average CX Maturity score is 2.69 out of 5, up 0.14 from 2025. For the first time, no councils remain in the Basic band. That is genuine, measurable progress.

But the data also reveals three patterns that deserve serious attention from anyone working in or with local government:

1.  Leaders are committed. The infrastructure is not ready. Endorsement and Commitment scored 3.3, the highest dimension in the index. But Tools scored 2.0 and Technology 2.5. A 1.3-point gap separates what councils intend from what they have built. Intent without infrastructure produces inconsistent outcomes for residents.

2.  Good governance is not enough if delivery is siloed. Governance scored 3.1 and Culture scored 3.0. Councils have the right structures and values. But Delivery scored 2.7. The breakdown happens at the handover points between departments. Good CX initiatives are failing to scale because no one owns the end-to-end journey.

3.  The councils pulling ahead are measuring. Measures averaged 2.7 out of 5. Two-thirds of councils collect feedback reactively. Fewer than 30% run a closed-loop programme. The 6% at the Leading level are not doing more. They are doing things in a more disciplined, evidence-based way. They measure, act and repeat.

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What progress looks like

The largest group in the 2026 CXMI is the Intermediate band, at 57%. These councils have started the journey. They have some governance, some culture and some commitment. What they are missing is the consistency to turn that foundation into reliably great experiences for residents.

The councils moving from Intermediate to Proactive are making three focused investments: building CX skills across their workforce, not just in customer-facing teams; improving their highest-friction service channels, one at a time; and introducing at least one structured feedback loop that closes. They are not trying to transform everything at once. They are building momentum.

The 22% already at Proactive are focusing on data and AI, cross-departmental accountability and continuous improvement cycles. The 6% at Leading are reaping the benefits: higher resident trust, more efficient service delivery and a workforce that understands its role in the customer experience.

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What this means for your council

The CXMI provides councils with both a diagnostic tool and a roadmap. By addressing these foundational gaps by investing in measurement capabilities, breaking down silos, and building technological infrastructure, councils can transform good intentions into the consistent, measurable improvements their communities deserve.

If your council has not yet participated, it is not too late to find out where you stand. The CX Maturity Assessment takes around 15 minutes and gives you an individual score alongside this year’s national benchmarks.

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Take on the CXMI survey for your council: surveymonkey.com/r/FFXM7KX

Read the full CXMI findings: findings.thestrategygroup.com.au