Cost avoidance as well as measures to avoid future costs were recently revealed to Auckland Council’s Strategic Procurement Committee.
Auckland Mayor Phil Goff says, “Taking advantage of economies of scale and smart procurement has allowed Auckland Council, Auckland Transport and Watercare to deliver real savings and future benefits to ratepayers.
“Last year we saved over $11 million in our expenditure, introduced systems and services that will help us avoid future expenditure of over $133 million and we’ve made productivity improvements to the value of $329,000. In total that’s a 30 per cent increase in benefits and savings on the previous year.
“The council has a duty to spend every dollar of ratepayer money wisely. I’m pleased to see that this focus on value for money is delivering multimillion-dollar savings to ratepayers.”
On top of monetary benefits and savings, an additional focus on environmental impacts and sustainability is also a key consideration to projects undertaken. Achievements include:
- Buying electricity as a group is saving council, AT and Watercare over $2m per annum
- Consolidating the maintenance and cleaning of our city and streets. This related work with AT and council has delivered savings of $8 million
- The Wynyard Edge Alliance (AC36) has a policy of recycling construction waste and has negotiated substantial cost avoidance. In addition, it is a Skills Hub for Mana Whenua, giving Maori graduates the opportunity to develop skills and gain employment through sub-contractors. Cost avoidance benefits are $5.9 million
- Contractual requirements of the AMETI (Eastern transport construction Initiative), included the obligation to deliver specified sustainable outcomes, targeted recruitment and employment and supplier diversity requirements. This project has also benefited from $9.7 million in cost avoidance measures.
Strategic Procurement Committee Chair, Deputy Mayor Bill Cashmore said:
“The long-term commitment to achieving real value for money in our procurement and sustainability activities is incredibly encouraging. This is not simply a cost-cutting exercise, it’s transformational. It’s about getting more and better for less, creating better services and saving for today’s and tomorrow’s ratepayers and being mindful of the impact we have on our environment. I’m proud of the holistic approach we, as an organisation, are taking.”