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All tender processes run by the Otago Regional Council for public bus services will be audited by the New Zealand Transport Agency, which is concerned about the council's maximum bus age and emission standards.
The council recently adopted its new regional public transport plan, which included a requirement for commercial bus operators to replace buses after 15 years of service, and to comply with ''Euro 4'' or equivalent emission standards.
Both exceeded the national standards, imposed by the NZTA, for buses to be no older than 19 years and meet the ''Euro 2'' emission standard.
Before adopting its plan, the council applied to the NZTA for a variation from the national procurement rules, allowing its higher standards to be imposed.
The application was declined because the NZTA was not sure it would lead to best possible value for money in respect of public transport services, which were subsidised by the national land transport fund.
''The NZTA is concerned that the ORC's proposals could lead to higher bus fares and less competition ... In addition, there is no evidence that the ORC's proposals would lead to any increase in bus patronage or to any significant reduction in emissions,'' NZTA planning and investment manager (Southern-Dunedin) Bruce Richards said.
Accordingly, the NZTA would audit any future bus tender process ''as a first step'' to ensure it delivered value for money and the best outcomes for bus users in Dunedin.
The NZTA could decide not to fund the ''additional price premium'' the council might have to pay for the extra requirements, or not fund the service at all, he said.
ORC corporate services director Wayne Scott said the council would welcome any audit by the NZTA.
''They pop in and do an audit every few years anyway.''
Mr Scott said the council's bus standards were implemented years ago, and although they were higher than the national requirements, some Dunedin bus operators were already compliant with them.
If the council advertised public bus contracts for tender before the existing ones were due to expire in June, companies would have the option of providing quotes based on both sets of standards, he said.
The council had to consider tenders based on the national requirements, but was interested in seeing quotes for compliance with higher standards.
''Then we will know what the cost differential is,'' Mr Scott said.
The last tender round was about two years ago.
''We believe increased standards are partly why we have seen increased patronage, and did not want to reduce our standards. If an operator tendered the same price for both standards, then why wouldn't we go for the higher standard?''