House of Assembly Fifty-Second Parliament, First Session (52-1) 52 1 Parliament of South Australia House of Assembly published Question Time School Bus Services SCHOOL BUS SERVICES Mr GRIFFITHS House of Assembly Goyder SCHOOL BUS SERVICES Mr GRIFFITHS (Goyder) (15:13): My question is to the Minister for Education. Why have the contractors for up to 100 school bus route services been waiting for six months for their contracts to be renewed, and when will the minister renew them? Some school bus operators have purchased new buses, at a cost of up to $400,000 each, in good faith that their contracts will be renewed by the government following the minister's own comment on 13 September 2010 that 'the bus and coach industry wants certainty for private operators'. Minister, why the delay? The Hon. J.W. WEATHERILL House of Assembly Cheltenham Minister for Education Minister for Early Childhood Development Minister for Science and Information Economy SCHOOL BUS SERVICES The Hon. J.W. WEATHERILL (Cheltenham—Minister for Education, Minister for Early Childhood Development, Minister for Science and Information Economy) (15:13): I thank the honourable member for his question. The simple answer is that there has been no delay. What we announced— Members interjecting: The Hon. J.W. WEATHERILL House of Assembly The Hon. J.W. WEATHERILL: Well, the process we announced on 13 September last year is precisely the process that we are following. It is worth just recapping on what we announced. It was $114.5 million to modernise and improve our school bus fleet in terms of its air conditioning and seatbelts. The procurement process that I announced back in September has been proceeding without delay. The reason for the time taken to award contracts is that there is, simply spoken, more than one operator who has sought to tender for each of the routes. Contracts have been and will continue to be awarded by the department, and the department, of course, is in regular contact with those local bus operators and their association. About half the bus services that we provide in our schools are provided by private contractors and the other half by our own government fleet. Madam Speaker, you will recall last year that there was some concern amongst those opposite, and also on behalf of a number of their constituents in regional areas, about this whole potential issue of the rolling over of the contracts and the new arrangements. The concern at that time was that small local operators that had given good service to the community over many years would be squeezed out by the bigger players. We listened to those concerns. We sat down with the Bus and Coach Association and we designed a tender process which was designed in a way to ensure that existing contractors would be given a fair chance to compete with those tenders. The tender process involved a two-step process. The first step was an expression of interest process to see whether there were any routes where there was no competition for tenders so that we could go to direct negotiations with those existing operators. Despite the fact we were told that would be the case, it did not happen. There was competition in relation to each of the routes. The second step involved requests for proposals for each route. Among other measures to assist existing operators, this request for proposal process included a weighting for the incumbent bus contractors to recognise prior service and the cost to the government when changing from one bus contractor to another. So, there is an in-built fairness to the existing operators. We have now sent out over 900 requests for proposals for 99 routes of the 275 routes that exist, and I am very pleased to say that the first seven contracts to be awarded have been awarded to an existing local contractor. The member for MacKillop would be interested because the local and incumbent bus operator, P.G. and M.A. Stone, has been awarded seven bus contracts for the Keith Area School. This is in recognition of their good service to the Keith area and to the community, as well as their ability to provide the service with upgraded safety standards and also air conditioning standards. As we go along, what we do is we communicate with the successful— Members interjecting: The Hon. J.W. WEATHERILL House of Assembly The Hon. J.W. WEATHERILL: For those members opposite, what happens is that as the contracts expire we seek to go out to tender for those contracts. If you have more than one person who wants to participate in this process then you have to conduct a procurement process. That is pretty orthodox, and that is what we have chosen to do. As a tenderer is chosen and is successful, we tell the unsuccessful tenderer and the successful tenderer and negotiations are then finalised in respect of the successful tenderer. This is the procurement process that we announced last year. Nothing has changed with it. It is rolling out as we expected. Members interjecting: The Hon. J.W. WEATHERILL House of Assembly The Hon. J.W. WEATHERILL: I must say that for members opposite there were different points of view. We had the agrarian socialists up the back who did not want a contracting process, they wanted to have direct dealing. Then, at the front, you had the economic rationalists who thought that we should be going out to tender and that it should all be based on price. We have tried to get a sensible blend of giving proper recognition for prior service and the good service that has been provided by existing operators. We designed a procurement process which gives them every fair opportunity to win those tenders, but the process has thrown up more bidders for each route than we need. What that means is that you have to conduct a process. I have spoken to the Executive Director of the Bus and Coach Association, Sonia St Alban, just this afternoon and she accepts that it is important that accurate information be put out there to contractors who are part of the process. There is no doubt that it is an anxious time for those people who have put in a bid for these routes. This is their livelihood, I accept that, and we are doing everything possible to expedite the processing of that tender process so that we can award the tenders to the appropriate and successful bidder and then move on to the next contract as that contract expires.