New Contract Model Achieves Savings

New Contract Model Achieves Savings

Noise control is a statutory duty of Auckland Council under the Resource Management Act to 'take action to control instances of excessive noise'. Noise Control services were provided across the Auckland region by external contractors under seven legacy council contracts. There were inconsistent levels of service and bases of payment across these contracts. Auckland Council hoped to procure new contracts that addressed these issues, with a target of saving between 5% and 20% of the budget for the service.

Morrison Low was engaged to plan and project manage the implementation of a suite of noise control contracts across the Auckland region. Morrison Low recommended a regional contract model and procurement strategy and then assisted Council to develop contracts with economies of scale based on a standardised level of service, which was an increase over the level of service experienced in most areas of the region. This increase in service level equated to faster response times, 24 hour service delivery and a consistent approach to enforcement. The procurement allowed for different levels of service to be priced by potential suppliers, allowing Council the flexibility to select the level of service that represented best value for Council.

The procurement resulted in four area-based contracts being awarded and implemented on time within a tight timeframe. The competent local supplier market has been increased through the procurement, which increases the likelihood of longer term competitiveness in the market. Contracts have been implemented that provide for an increased level of service across the region under standardised specifications. There is greatly enhanced performance measurement within the contract framework, which is incentivised to facilitate improved services and allows benchmarking across suppliers. In addition, savings in the vicinity of 18% were achieved based on expected future volumes of service required.

Project Contact: Ewen Skinner

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