Rail Supply, Rolling stock & Rail Vehicle Design, Safety, Standards & Regulation, Signalling & Communications

ARA calls for tender changes to maximise benefit of rail

The Australasian Railway Association (ARA) has called for an update of tendering procedures around Australia to accelerate job-creating rail projects.

Releasing a new tendering framework, the ARA included 21 recommendations to improve the procurement process for rollingstock and signalling equipment.

ARA CEO, Caroline Wilkie said that implementing these recommendations would extend the benefits of rail infrastructure and supply contracts.

“Australian tendering costs are higher than global benchmarks and that makes it harder to get projects out of the planning phase into delivery,” said Wilkie.

“As governments look to bring on new projects to speed our post-pandemic economic recovery, simple and fast tendering processes will be needed to get people quickly back to work.”

In the framework, the ARA’s recommendations include changes to market sounding and pre-project engagement, a one-time national pre-qualification scheme, a simplified probity management process, clear requirements at the point of early contractor involvement, a harmonisation of specifications, and a cost recovery process for rollingstock design.

“Small measures like a one-time-only pre-qualification process and standardised templates, terms and conditions would make a big difference and reduce costs for both government and the private sector,” said Wilkie.

The ARA commended the NSW Government Action Plan, which it said set the standard for procurement and should be the benchmark for other states.

“A nationally consistent procurement process would cut red tape and focus tender discussions on the all-important project outcomes,” said Wilkie.

Today, Australian tendering costs are approximately 1-2 per cent of a project’s total cost, well over the international benchmark of 0.5 per cent. Bringing Australia into line with other countries would allow for reduced project pricing as well as improving participation by reducing the risk profile for tenderers.

“It is important tender processes are fit for purpose and resourced to succeed so projects can move from planning to delivery as soon as possible,” said Wilkie.

In a speech to the shadow cabinet on May 11, federal opposition leader Anthony Albanese’s call for more local content in rollingstock. Albanese said that trains should be built in Australia, and pointed to examples in Queensland, Victoria, and WA.

Wilkie noted that well-managed procurement processes can create employment in Australia.

“Now more than ever we need government and industry working together to get projects up and running to deliver jobs for all Australians.”

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