Monday, May 27, 2024

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HomeIssue 1A way to reduce cost of sealing NT's Outback Way?

A way to reduce cost of sealing NT's Outback Way?

p2228-Outback-Way-3By KIERAN FINNANE
There may be a way to significantly reduce the cost of sealing the Northern Territory’s stretch of the Outback Way. As previously reported, the NT’s going rate for the seal is $800,000 per kilometre compared to across the Queensland border, where Boulia Shire can do it for well under $300,000.
At a recent meeting of the Outback Way Technical Construction Group, Alice Springs Town Councillor Jamie De Brenni (pictured), who works in construction, proposed that a project management board be set up to contract the work, as a way to get around having to go through the NT Government’s tendering process.

He said the two shires either side of the border – Boulia in Qld and Laverton in WA – are set up to contract the work out on an hourly rate. “They’ve got everything working so well” – it’s “wet hire, hourly rate, no stand-down, no standup”.
The project management board would be responsible for letting the contract, including “local content”, getting materials on site and paying bills.
If an asphalt team is already mobilised across the border, working at an hourly rate, the board could take advantage of their availability to do work on the NT side, says Cr De Brenni.
It would be a more streamlined and less expensive process than the present one of letting government tenders, often involving more than one government department, and typically only upgrading or sealing short sections of road at a time: “With governments you get five kilometre contracts, then sit down for six and a half months till the next 10 kilometres comes up.
At this stage, Cr De Brenni’s proposal is just that. It has to go back to the NT Government and the interstate shires involved to be progressed further.


  1. Really is time that govt’s looked at tender system. It is a very expensive form of getting work done and always goes over. The companies tendering seem to think that because it’s taxpayers money then the sky’s the limit. Point proven. $300,000 in Qld. $800,000 in NT. Govt should really be doing their job (that they are paid for by taxpayer) and asking for justification of costing and refusing over costing. A tender is a tender, not an estimation of costs.

  2. This guy has got it right.
    As a long time Territorian I remember we had a similar system before self government.
    Seems we have gone backwards even since.

  3. Jamie makes a few claims that are mathematically flawed.
    The cost of roadworks to a Tanami Road standard has been in the order of $400,000 to $500,000 per km. I believe the Outback Way standard will be similar. Where did the $800,000 come from?
    The suggestion of using Interstate Contractors flies in the face of what Territory Contractors have been trying to eliminate for years – buy local, not give it away to the Mexicans over the border.
    The procurement principal of hourly hire is very much outdated, anyone who has a budget to keep intact wants to know what the final price is before committing to start a project.
    Jamie does have a few good ideas though.
    The suggestion to increase the lengths of construction has some merit as economies of scale will become a real financial benefit.
    The Project Management Board also has some merit, as the focus will be on achieving the completion of the Outback Way.

  4. In the bad old days tenders were costed by the government departments involved to check that the job could be done to the requested standards at the tendered prices and also that the tender was not overly inflated in costings.
    Also, to further keep the costs down, the tenders became, after closure and being awarded to a winning contractor, public information and could be requested by all in full detail.
    This resulted in very active competition between tenderers to trim their costs to beat the prices of the other competitors.
    Further, the contractor had to cover a maintenance period after the works were finished at their own cost thus ensuring better quality in the work.


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