BECOME A MEMBER
Connecting New Zealand

Explainer - moving to an integrated delivery model

12 Dec 2024


Unsure what an Integrated Delivery Model for NZ’s state highway road maintenance network might look like? Check out the latest explainer from CCNZ Technical Manager Michelle Farrell, below!

Seventeen new road maintenance contracts around the country will be tendered in early 2025. The plan is for tenders to be released in February, with a closing date in May. These new contracts – referred to as Integrated Delivery Contracts (IDCs) – could be in place for up to 10 years.

So, first of all, why would NZTA want to tender all of these 10-year road maintenance contracts in one go? The reasoning behind this decision is to provide certainty of a pipeline of work, enabling companies to plan where to allocate resources and training.

While it might not appear to support inclusion of smaller players into the market, it takes a wider view of the supply chain while providing certainty to the market.

That leads to the next piece of the puzzle – ‘contestable work’ and the ‘Directory.’

What is contestable work?
"Contestable work" refers to tasks that can be competed for by different companies other than the incumbent IDC supplier. This ensures that no single company has control of all the work, allowing others to bid to offer the same service, often to try to do it better or at a lower cost.

The graph below shows how NZTA plans to treat different portions of the work from 2025 onwards. A large portion of maintenance work is core IDC scope activities – the bread and butter for the main contractor awarded one of the 17 new IDCs.

The top portion is packages of work made contestable through the Directory.

This leaves the two portions of “potentially contestable work,” which could include pavement rehabs and/or renewals, pavement marking, and/or environmental (drainage) renewals.

How will the ‘potentially contestable’ work be allocated?
The IDC holder will be allocated the majority of ‘potentially contestable’ work at the start of the contract tenure. However, a percentage of this work will be held ‘at risk’ based on performance. If the IDC holder underperforms, the ‘at risk’ component will be made available to the Directory. Conversely, if the IDC holder demonstrates outstanding performance, some of this contestable work may be directly awarded to them.

Subcontracting requirements
The IDC contracts will also retain a requirement that a portion of the work be subcontracted. This requirement is applicable across all work undertaken by the IDC supplier, even though it is not explicitly referenced in the graphs.

Will the IDC holder be able to bid for Directory work?
This is yet to be finalised and may vary by region, depending on the strategic direction NZTA wishes to take and the availability of resources within each region.

What about core work?
Core work includes everything you would expect from a standard road maintenance contract, including cyclic activities, incident response, reactive maintenance and renewals.

The distinction between core work and contestable work will change over time based on government priorities, reflected in Government Policy Statements and the National Land Transport Programme. Contestable work is essentially work activities with programmes that are larger than what the IDC holders, as a collective, can deliver.

What does ‘integrated delivery’ mean?
Integrated delivery implies closer collaboration among various stakeholders – almost working shoulder-to-shoulder. However, NZTA has emphasised its intention to provide firmer direction in strategic asset management, such as deciding what work needs to be done on the network and when. The delivery of work, however, will be more collaborative, involving NZTA and contractors working together to optimise programmes and ensure efficient, effective delivery.

NZTA will lead programme management to align and sequence all activities – whether undertaken by the IDC supplier, Directory suppliers, third parties, or capital projects. This approach aims to optimise network use and minimise customer impact.

In summary, NZTA’s 2025 procurement framework represents a significant shift towards collaboration and performance-based outcomes, with clear roles for both core and contestable work. This framework seeks to balance efficiency, innovation, and effective delivery while maintaining flexibility to adapt to regional needs and contractor performance.

 

 

RELATED


Principal Business Partner
Core Associates
Major Associates
A B Equipment Ltd
ERoad Ltd
Hynds Pipe Systems
Enviro NZ Services Ltd
GHD Limited
Terra Cat
SITECH NZ
ENZED
Manage Company
Prime Fluid Management
TR Group
Central Group
Remarkable People Ltd
Holcim New Zealand Ltd
BNZ Partners
Checksafe Ltd
Liebherr New Zealand
Hydraulink Fluid Connecters Ltd
MBP (NZ) Ltd
Kobelco New Zealand
Greenlight Insurance Brokers
New Zealand Transport Agency
TRIG Instruments
CivilShare
The Drug Detection Agency
MIMICO NZ Ltd
Crediflex New Zealand Limited
Mico New Zealand Ltd
Winstone Aggregates
Turners Group Ltd: Head Office/Auckland
First Gas
Plan A
Parallaxx
Advice Financial
Brandt Tractor Limited
Youngman Richardson
Teletrac Navman
Bridon Cookes
Coninnova Limited
SAMI Bitumen Technologies Pty Ltd
Vertical Horizonz NZ Ltd
Northpine Ltd
Site App Pro
n3
Infrastructure Sustainability Council
Westpac NZ Ltd
Over and Out Communications
Solo
beforeUdig
Geosynthetic Partners International Ltd
AWF
Graymont
Wirtgen NZ Ltd
Absolute Immigration NZ
Global Survey - Auckland
Aptella
AEL
Marley NZ Ltd
Iplex Pipelines NZ
Franklin Smith Group
Brolube New Zealand
AECOM New Zealand Limited
H.J. Asmuss & Co. Ltd
Portacom New Zealand Limited
Humes Pipeline Systems
Fluiconnecto Ryco New Zealand Ltd
Nulca NZ
UDC Finance
TDX Ltd
Infrastructure New Zealand
Assignar
Rimkus
RB Recruitment
Terra Infrastructure Pty Ltd
Geofabrics New Zealand Ltd
Connexis
Trade Me Jobs
TotalEnergies NZ Ltd
RobLawMax Recruitment
Doug the Digger
Porter Group Limited
Commercial Hire NZ Ltd
Firth Certified Concrete
MATES In Construction
OneStaff Limited
Komatsu New Zealand Ltd
Reliance Reinforcing Limited

Log in





Forgot password?
Create an Account