The former RAF and British Airways pilot showed a lack of basic flight safety when he crashed on to the A27, the Civil Aviation Authority said. 11 men were killed in the crash.
A hearing in London was also told Mr Hill refuses to accept the evidence as he appeals to have his flying licence restored.
David White, representing the Civil Aviation Authority, said: “The issue here is Mr Hill does not appear to accept there is any issue with his competence.
“He thinks he remains competent.
“It was his own failings and shortcomings which led to this accident. The reason things happened is because he commanded it.”
Mr Hill was at the helm of a vintage Hunter jet when it crashed onto the busy A27 in a lethal fireball during the air show in 2015.
Mr White added the Shoreham Airshow disaster happened as a result of a litany of errors and poor judgement as well as poor airmanship, planning and preparation.
Read More: Shoreham Airshow pilot said licence taken away to ‘avoid bad publicity’, panel told
“Putting him back in the cockpit would be adverse to public safety and confidence,” Mr White said.
Lawyers for Mr Hill accused the CAA of clutching at straws in their case against him, adding he has “survivor’s guilt”.
Stephen Spence, representing Mr Hill, told the panel that the consequences of his actions on the day of the crash should have no bearing on their decision to revoke Mr Hill’s lifetime licence.
Mr Hill has more than 14,000 hours in the cockpit and the CAA were refusing him the opportunity to prove his continued competence, Mr Spence said.
The short period of time at Shoreham where his flight went wrong should not cause the CAA to revoke his licence, He added.
Mr Spence said: “Errors made over 20 seconds are said to demonstrate incompetence to such a level no one could ever expect him to manipulate safely the controls of an aircraft ever again.
“It’s an extraordinary suggestion that he is so dangerous if we were to let him loose in a cockpit he would fly so dangerously his co-pilot would not notice or be able to deal with it.”
Members of three families of those who died attended the two day hearing in London.
The independent panel of non-executive directors of the CAA is expected to give their conclusion within ten days.
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