Contractor Network Outcomes Contracts (NOCs)

Local authorities teaming up with NZTA – how is the NOC model impacting local government?

 

The NZTA’s new NOC model has affected contract work from contractors’ other main source of work – local governments which, around the country, are in a conundrum whether to go down the NZTA bundle path or not. While one size does not fit all, and every region is different, alliances between the NZTA and local governments over roading maintenance are picking up a lot of interest.

The conundrum created by the new NOC model was a subject that came up in papers at this year’s Road Engineering Association of Asia & Australasia conference and not all councils agree with the NZTA.

In a conference presentation called, ‘Does size matter in procurement?’ by Warren Furner from the Ruapehu District Council and Roger Coles from GHD, it was noted that the local council ‘swam’ against the current of amalgamation and bundling and challenged the ‘bigger is better’ approach of the NOC model.

The Ruapehu District Council, when developing its procurement strategy, say the authors, unbundled its maintenance contracts and extended contract terms to better align with plant life and investment returns, and allow “significant participation” from “small to medium enterprise in a contest for smaller parts” of the council’s road maintenance business. It was noted that the process was like “returning to the roadmen of old”, who watched over the asset.

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