Friday, July 29, 2011

South Australia, rural school bus contracts being lost to big outsider firms

NZ in Tranzit in South Australia

Protests have been held in Adelaide by owners and drivers of rural bus companies operating country school bus contracts across the state, as large out of state companies winning more than half the tenders

Bus and Coach Association SA president Roger Quinsey  told Adelaide Now those contracts were being lost to a business that appeared to be a Queensland-based company.

"Some of our members have operated their services for 55 years, some 37 years and many others in between," he said. "They have not missed a day of their service ...yet when they've gone to tender they have found they have not been awarded their tender. It appears to be price-based.
"We have great concern that a lot of goodwill will be lost and a lot of good service will be lost." Opposition leader Isobel Redmond said the decision was a devastating blow to regional communities.

The process echoes that which occurred in New Zealand in 2008 when over 60 mostly smaller rural bus companies many of these long standing businesses in their  rural communities were effected when Ritchies Transport Holdings and Go Bus Ltd won a large portion the nation's six year school bus contracts.

At the time a former policy adviser Greig Neilson, of Queenstown, who helped draft the ministry's bus tender guidelines, said the ministry ignored recommendations that would have preserved competition among bus companies.  According to the The Southland Times (December 18 2008) He advised the ministry that most bus company owners in Southland were close to retirement age and if their business was severely cut now, in six years they would not have a company capable of re-tendering to pass on.  

However it wasn't just those close to the retirement who lost their livelihood, all smaller companies suffered and some had to fold their small operations.  In Reporoa, near Rotorua,  operator Cave Coachlines owner Ian Cave said he would be out of business when his contract runs out at the year's end. The 46-year-old man owned six buses and employed two staff, in addition to himself and his wife.

Ian Cave told  The Daily Post (Rotorua) in September 2008 his bus company had been operating for 20 years but he was not surprised bigger companies got the school contracts. "The big companies just keep getting bigger, they can afford to do things a bit cheaper than we can. It is disappointing after all this time. We have been a part of the community for so long.

Following Ritchies' success in winning so many tenders the company ordered 120 new, purpose built school buses from Designline in December 2009, saying at the time they had rejected importing higher emission Japanese buses or cheaper Chinese buses, in favour of going for the higher quality offered by Designline.  These were to be supplied over four years [it is not known where the immanent sale of Designline will leave this process].

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