The Australian Competition and Consumer Commission (ACCC) has granted authorization to Council Solutions and a group of four Adelaide councils to jointly procure kerbside waste collection services.
The four councils, Adelaide, Charles Sturt, Marion and Port Adelaide Enfield, are authorised to appoint a single provider for kerbside waste collection services to residents in their municipalities.
"The ACCC considers that running a joint tender process is likely to improve the four councils’ purchasing power and encourage more competition from suppliers than if each council conducted a separate tender process," ACCC Commissioner Sarah Court said.
"It is common for groups of local councils to jointly procure waste services. The ACCC has authorised many such arrangements across Australia over the years."
"The joint tender process is likely to result in cost savings through encouraging more competitive bids, reducing transaction costs, and other efficiencies. These cost savings can be passed on to Adelaide residents in the form of lower costs or improved services," Ms Court said.
The ACCC said that it had considered a “great deal” of information both for and against the joint tender agreements, with “strong objections” objections heard from bodies representing the incumbent waste companies currently holding the contracts.
"Some suppliers raised concerns that the size of the proposed contract would deter some suppliers from tendering, resulting in a worse deal for ratepayers," Ms Court said.
"While there may be some companies that choose not to participate, the larger tender is also likely to attract additional bidders, and overall we consider most of the potential suppliers which would bid if the councils contracted separately are also likely to compete for the joint contract."