Background
Prelabour caesarean section (CS) at early term (370–386 weeks) is associated with higher rates of adverse short‐term neonatal outcomes and higher costs than those performed at full term (390–406 weeks). Prelabour CS is more common in private than in public hospitals in Australia, particularly at early term.

Aims
To evaluate the impact of hospital sector (public or private) and timing of delivery on short‐term neonatal outcomes following prelabour CS at term.

Materials and methods
A retrospective cohort study of 22 954 viable singleton prelabour CS births at term (370–406 weeks) at a single centre encompassing co‐located public and private hospitals during 1998–2013 was undertaken. Propensity score analysis was used to adjust for confounding differences between sectors. The primary outcome was Neonatal Critical Care Unit (NCCU) admission with serious morbidity. Secondary outcomes included respiratory distress, vigorous resuscitation and jaundice.

Results
The private hospital performed prelabour CS at over double the rate of the public hospital (33.7% of all private births vs 14.7% public) and more private than public prelabour CSs occurred at early term (66.8% vs 47.9%). Public babies were more than twice as likely as private babies to require admission to NCCU with serious morbidity (adjusted odds ratio (AOR) 2.54, 95% CI 1.77–3.65) but were less likely to need vigorous resuscitation (AOR 0.53, 95% CI 0.45–0.62). Disparities in outcomes between public and private cohorts were accentuated at full term.

Conclusion
Despite early‐term prelabour CSs occurring more often in the private hospital, public babies had more adverse outcomes and treatment escalations.