The Central Otago District Council has decided to extend its roading works contract with provider Fulton Hogan by up to two years.
The contract was due to reach its full term at the end of the year, and as the funding of roading-related activities was under increasing pressure from the Government, councils were faced with challenges, a council manager said.
Infrastructure services manager Jon Kingsford said councils had to make available funding go further or reduce the scope of works and the council undertook a review of Fulton Hogan's performance during the contract.
''A great deal of work has been undertaken with council's existing contractor to improve the efficiency of roading-related activities.''
The review found changes were delivering ''tangible benefits'', allowing the council to undertake more physical works at no extra cost, particularly metalling and drainage, he said.
Extending the contract with Fulton Hogan was a result of its positive performance in the review, he said.
''What we have done is looked at ... costs per activity within our maintenance or physical works programme and how that has changed over the course of the contract, and it's about getting more stuff done for the cost than we were previously.''
The contract, which would have expired on December 31 this year, began in January 2010.
Fulton Hogan had had council roading contracts since 1999.
A factor in retaining the same contractor was the cost associated with establishing a new one.
However, loss in efficiency was a larger issue, Mr Kingsford said.
''It's probably more about if we change contractors now, if Fulton Hogan did not win a new tender, it would jeopardise the efficiency gains we have made. We are looking to capitalise on those as much as possible.''
Council roading manager Julie Muir said the council was ''very'' happy with the quality of the service the contractor provided.
