SA’s new fleet management arrangements

South Australia’s state government has announced new fleet management arrangements, which will save taxpayers $1.7 million a year.

Finance Minister Michael O’Brien said global fleet management service, LeasePlan, had been selected from a competitive tender process to provide fleet management services and Pickles Auctions will dispose of State Government fleet vehicles.

The combined value of the two contracts is $15.8 million over seven years.

Mr O’Brien added that the South Australian Government Financing Authority (SAFA) would continue to own and fund the fleet vehicles, generating a lower borrowing cost to agencies in the lease rate.

LeasePlan will manage the fleet, coordinate servicing and maintenance, and fuel cards. “Both providers will use web-based management systems extensively as part of their services,” Mr O’Brien said. “This will generate significant savings to government.

“To replace the existing fleet management system would require a multi-million dollar investment, which would need to be recovered from agencies through higher lease rates.”

According to Mr O’Brien, LeasePlan currently provides fleet management services to the Commonwealth and Tasmanian governments. Pickles Auctions is Australia’s largest auction group and last year sold more than 200,000 motor vehicles, trucks and machinery.

“Existing government employees will have the opportunity to apply for positions with LeasePlan and Pickles Auctions,” he said.

Mr O’Brien said benefits of the new model include a reduction in advertising costs; maintaining the State Government brand in selling quality vehicles to the general public, including the auction continuing to be a government-designated vehicle auction; contract performance management including service level benchmarks and targets; and a reduction on average time to sell vehicles compared to the current arrangements.

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