Doesn't confed have a militia? Or are they called Home Gard or reservistststs? Like Flash from the The Heart Of The Tiger novel. Fleet can't be everywhere, so large colonies and colonies close to the front have them. To protect against pirate raids and offer assistance as fodder until the fleet does arive.
There's several different things. A militia would be a local group formed for planetary defense, essentially without the assistance of the central government. That's exactly what the Border Worlds militia units were during the war - Confederation citizens forming their own military units to defend against the Kilrathi on a local scale. It formed into the force seen in Wing Commander IV in the same fashion as similarly-purposed southern militia units became the Confederate army at the beginning of the Civil War.
We also see several other levels of local military. There's InSystem Security, which is Wing Commander's equivalent of the coast guard -- they operate on a local level but interact with the regular military on an organizational level (and are presumably paid for by the Confederation government.) This is the group Blair transfers to at the start of Wing Commander II and the 'militia' organization seen throughout Gemini in Privateer.
Then there are Home Defense squadrons, seen in the Wing Commander III novelization. These are a mix of the two - militia units funded by local governments/citizens which are also integrated into the structure of the Confederation Space Force.
(It's worth pointing out that the local governments of the Confederation have never really been explored. One of the Privateer Online concepts was especially interesting - instead of lots of American State Juniors they ran the gamut from extreme socialism to medieval feudalism...)
