The Victorian Government has committed to achieving fleet savings by implementing more efficient car fleet arrangements.
The Victorian Government has committed to achieving fleet savings by implementing more efficient car fleet arrangements. The new arrangements are expected to deliver savings by:
VicFleet will provide a report the Minister for Finance detailing the findings of the survey, recommendations on implementing the new arrangements and suggested amendments to the Standard Motor Vehicle Policy (SMVP).
The Minister for Finance has requested that VicFleet conduct the survey and provide him with a report of findings upon completion. Any recommendations regarding implementation and any changes required to the SMVP will be reported and agencies will be fully consulted to ensure there is no adverse impact to operation of services.
Initially, there will be little or no change to you. Once the new arrangements have been approved by the Minister for Finance, the transition to these new arrangements will occur progressively as vehicles reach their end on life. VicFleet will consult with you fully prior to transitioning to the new arrangements and entering into a Memorandum of Understanding with VicFleet.
VicFleet is a business unit operating within Strategic Sourcing, Department of Treasury and Finance, which performs functions including overseeing financing and management of the Victorian Government’s motor vehicle fleet, management of SMVP and development of fleet policy and procedures, managing the government’s motor vehicle FLF and operating VicFleet Management and Leasing.
The SMVP is issued under the authority of the Minister for Finance and is a whole of Victorian Government framework to optimise the management and use of government vehicle assets. Adherence to this policy is mandatory for all Victorian General Government departments and agencies and should be used as a guide for all other government entities. A copy of the SMVP can be found on the VicFleet website at www.vicfleet.vic.gov.au
VicFleet uses a FLF which means your agency owns the vehicle.
Departmental secretaries and agency chief executive officers, or authorised delegates are responsible and accountable for managing their vehicle fleet according to the SMVP. This is standard practice.
There are no changes in the short term. We have obtained an exemption that allows you to continue to purchase vehicles as you currently do on a fit for purpose basis. We are developing a new policy for 2018 & beyond, which will require approval by the Minister for Finance.
The maximum you pay is the contract price. We will adopt any discounts you already have, or you can take advantage of the discounts we also have. At the end of 2017, we intend to generate some competition between suppliers, aggregating our spend and establishing an approved list of vehicles based on whole of life costs. We anticipate this process should provide better discounts to everyone.
You choose your own dealer.
We provide a full suite of reports on our website. We can tailor reports to suit your needs, provided we have the data. Our end of month invoice is broken down by rego and cost centre. We also provide the journals to allow you to take up the data into your finance management system.
The lease term is 3 years or 60 000km whichever comes first. In this instance, we would provide a 12 month lease, or we could look at the usage to see if it’s cost effective to extend the lease term to e.g. 3 years 90 000 km.
No we always assume 60 000km, however vehicles with low ODO readings will sell for more than estimated at auction & you will get his back in the end of lease reconciliation.
To be conservative, the residual value is calculated using the lower of Glass’s guide & Redbook future value calculators based on distance and age.
We have some existing contracts already in place for departments that you could tap into.
As a general rule we do not lease trucks, however we do have some trucks on lease so this is a possibility.
Our lease charges are a budgeted amount. At the end of the lease, a full reconciliation of all costs incurred over the life of the lease is calculated. Any shortfall is charged to your agency and any overpaid amount is credited back to you. There are no hidden costs or end of lease penalties. As our budgets are fairly conservative, we generally credit back amounts to clients.
If there is no longer a requirement for a vehicle, you may return it for disposal. There are no early termination penalties or other hidden costs. If you terminate early, there may be a budget shortfall.
At the end of the lease, VicFleet review all actual costs against cost you have paid & we either pay back any overpaid amounts or charge you the difference.
You log your vehicle for collection by Pickles through our disposal portal. We inspect, clean up the car for sale, set the reserve, sell by public auction, pay the sale proceeds back into the lease, reconcile the lease costs & terminate the lease. Pickles remove the plates & return to VicRoads for refund of registration.
We currently do not have a contract for servicing & prepaid servicing is not mandatory. If prepaid servicing is not included, you would be required to manage all servicing costs locally.
You can use local suppliers to service your vehicles e.g. Kmart Tyre & Auto as long as the manufacturers service requirements are met.
If required we could manage the servicing costs & recharge back through the lease, however this is not our normal model.
We could add roadside assistance to the lease if not already provided by the manufacturer.
There would be no requirement to change & we could add the cost of insurance/repairs to the lease.
The spreadsheet used to calculate executive officer costs belongs to the Victorian Public Sector Commission. VicFleet is not responsible for this & we cannot alter it.