This paper traces key policy challenges facing Australia's metropolitan cities as a result of multiscaled shifts in their governance contexts. These shifts, related both to the neoliberal erosion of a national commitment to universal social provision and the adoption of a 'competitive city' governance paradigm at the urban scale, have produced a set of governance challenges, particularly concerning urban social inclusion and cohesion. Moreover, a range of institutional obstacles continues to hinder the generation of urban governance capacity to address these challenges. The paper works through the nature of these obstacles and takes a pragmatic approach to identifying opportunities to mobilise and reenergise the capacity to govern in Australia's big cities. In particular it points to the need for a national urban governance agenda, the need to move beyond the limits of the 'competitive city' governance paradigm to mobilise the resilient capacities of state intervention, and the need to harness private resources and capacities more effectively to public policy rather that market-driven aspirations.