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System of public tender for milk supplies

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The Minister for the Capital Territory, Mr Tony Staley.has decided that

the ACT Milk Authority will acquire future milk supplies for Canberra by a

system of public tender.

Mr Staley said that the present system gave little incentive to suppliers to

tender at genuinely competitive prices. The new system would provide a genuine

incentive for suppliers to compete properly in the interests of consumers. .

Mr Staley said the method of acquiring milk wa£ the subject of a recent public

Inquiry. An assessment of the matters dealt with at the Inquiry had led him

to make these decisions:

. Producers should be given the opportunity to compete for a share

of the Canberra market by. a system of public tender ;

. In recognition of the importance of milk as a natural health food,

there must be no lowering of quality and quality control standards.

Equally important was guaranteed maintenance of these standards;

. Competition should continue to be stimulated by sharing access to

the market.

Mr Staley said that in directing the Milk Authority to. engage in public

tender he had emphasised the importance of supplying Canberra consumers with

the highest possible quality of milk at the lowest price. He said he wanted to

ensure that the cutting edge of competition worked to achieve this aim.

In letting tenders, price would be the major determinant of market share. .

The Authority would also take into account quality, quality control, guarantee

of supply, performance and maintenance of standards.

He said he did not favour a situation where a single producer could take the

whole market. He said he hoped that traditional suppliers could continue to

enjoy a share of the Canberra market, but any producers who were unable to

perform within the criteria established by the Authority would need to

contemplate loss of their market share.

Mr Staley suggested that the Authority should renew existing contracts for

three months to enable time for the implementation of the new system.