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Group procurement delivers $288 million in savings and benefits for Auckland

Published: 8 August 2018

Auckland Council's group source procurement programme, which combines Auckland Council, Auckland Transport and Watercare when procuring products and services, has delivered $288 million of savings and benefits since 2016, it was revealed today.

Benefits

The council’s strategic procurement committee received a report on the programme, which delivered $112.4 in procurement benefits in the 2017/2018 financial year, following $106 million in 2017 and $69.9 million in 2016.

The report details the monetary benefits of the programme, which combine savings, cost avoidance, revenue and productivity improvements. It also includes detail around the sustainable procurement model, which has seen various initiatives such as electric vehicles and using Skype for Business which reduces fleet costs and carbon footprint.

Joined-up 

Auckland Mayor Phil Goff says, “Using council’s scale and a joined-up and collaborative approach to procurement is delivering value for money to Aucklanders.

“In each financial year of the procurement programme, the council has saved money and delivered more to ratepayers for less.

“Through joint procurement, we have avoided unnecessary expenditure of $71 million, saved $20 million in operating costs and realised $5.2 million of productivity improvements through initiatives such as our online building inspection book and schedule platform,” says Phil Goff.

Smarter, sustainable approach

Committee chair, Deputy Mayor Bill Cashmore says the smarter, sustainable approach is reaping rewards.

“In addition to the financial benefits of this new approach, it’s working better for the environment with a significant number of sustainable projects and initiatives enabled through the process.

“We are planning better for the future, for example moving toward an all-electric fleet with 50 vehicles set to be introduced between now and 2020. That’s on top of the 14 existing hybrid vehicles which show we are committed to being an environmentally friendly green operation.

“It has also made the sourcing of products and services in a smarter way, such as using clay excavated from one project to level fields at Wairau Intermediate School instead of sending it to landfill.

"We can also source better social outcomes with suppliers on our Hayman Park improvement contract required to outline their programmes that contribute to it.

“And we are delivering for Aucklanders, with community clean-up events to tackle graffiti and cadetship programmes that support career training.

“Our move to Skype for Business and more video conferencing hardware has helped us reduce our fleet costs and reduce our carbon footprint with staff able to work from different locations.

“All in all this is another tangible demonstration of how the council has been smarter, more unified and more efficient in order to deliver some significant results, and we are determined to continue to deliver these outcomes for Auckland.”