Probity review dismisses Snapper tender complaint

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Auckland integrated ticketing tender found to be robust

By Rob O'Neill | Auckland | Wednesday, 22 July, 2009

Complaints by Wellington smartcard operator Snapper that the tender process for a new integrated ticketing system for Auckland public transport was biased and flawed have been dismissed.

A report, released to Computerworld under the Official Information Act today, finds there is no evidence of a predetermined outcome by either the tenderer, the Auckland Regional Transport Authority (ARTA), or the funder, the New Zealand Transport Agency (NZTA).

In December 2008, Infratil company Snapper Services, which operates the Wellington public transport smartcard and which tendered to do the same for Auckland, raised concerns with the Minister of Transport about ARTA and its conduct of the tender. The minister referred those concerns to NZTA for consideration.

The NZTA report released today, dated 25 May, is the result of those investigations and includes a separate report from NZTA's probity auditors McHale Group.

The review found the tender was consistent with the objective of obtaining the best value for money and the draft project agreement included in the tender was consistent with those used for similar international integrated ticketing projects.

It is widely believed French company Thales was selected as the provider from a shortlist that also included Infratil and Downer EDI, however, no formal announcement of the winner has been made and the tender is still considered "live".

Auckland's quest for an integrated ticketing system has now taken nearly three years. An annoucement of the tender's winner was scheduled for late last year. The finalisation of the tender review could now clear the path for development to begin on the project.

"The team accepts that ARTA used best endeavours to design the AIFS [Auckland Integrated Fares System] requirements in conjunction with NZTA staff (as had been required by the Board), and to take account of the principles concerning a national approach," the report says.

Snapper CEO Miki Szikszai said he was not prepared to comment on the report ahead of a press release on the investigation expected later today.

Among Snapper's concerns were statements made in the media by Auckland Regional Council chairman Mike Lee, according to the McHale Group report. Lee had commented on fares charged by ferry operator Fullers, a subsidiary of Infratil.

The company also complained that Lee had separately implied in another article that the Snapper system was inferior. That correspondence, on March 19, asked ARTA's probity auditor to advise ARTA the tender process had been "irredeemably compromised and must be terminated".

"ARTA's probity auditor discussed this issue with ARC's chairman and it was agreed no further public comments would be made," the McHale report notes. "The probity auditor wrote to Snapper on 25 March 2009, and informed it he was of the view that while the comments were inappropriate, they had not influenced the outcome of the tender as he (the probity auditor) had personal knowledge of ARTA's recommendation prior to ARC's chairman making this statement."

The NZTA investigation team included the agency's chief legal counsel, a contracted member and a representative of McHale Group.