Northampton borough council is likely to look for a private sector contractor to run its environmental and waste services contract, after having recommended not to bring the work in-house.
The council is currently considering plans for the future of the service when its existing contract, procured jointly with neighbouring Daventry district council, and which is currently held by Amey, comes to an end in June 2018.
Recycling and waste collections in Northampton are currently carried out by Amey – formerly Enterprise
The contract was originally signed in spring 2011 and includes waste and recycling collections, parks maintenance and street cleansing.
When the contract was signed in 2011, it contained an option for a further seven year extension, subject to the agreement of all three parties, however Daventry district council has opted not to pursue this option.
Daventry has already agreed proposals to adopt a new recycling and waste collection system when the contract expires in 2018. But, the council is still assessing whether to pursue a private contractor to run the service, or whether to bring the work in-house.
Options
At a meeting next week (16 November) Northampton council’s cabinet will examine its options for the future of the contract, which includes bringing the service back in–house; setting up or using an existing local authority-owned company or continuing to contract out the service and going back to the market to award a new contract.
According to the council, all three options are likely to be more expensive than the current contract – but it is claimed that the option to contract out the work would provide the best option under the criteria of quality, risk and value.
The conclusion was reached following an assessment of the options by consultancy firm Eunomia – which suggested that contracting out the work would lead to a higher cost for the local authority offered the option in terms of quality of service.
Assessment
Taking the service in-house was deemed to be the more expensive option of the three – Eunomia’s assessment claimed.
And, the council also suggested that the in-house and local authority company options would provide a greater level of risk than an out-sourced service.
In summary of the three options, the council concluded: “An out-sourced solution comes with the ability to transfer risk that is not offered by the LAC option, with the profit element being the cost to the council associated with the transfer of the risk of managing cost overruns or service issues. The lower price for the LAC model therefore needs to be viewed in this context. It also allows for no consideration of the risk retained by the council which, depending on further more detailed analysis of the underlying costs, could be more than the cost differential projected by Eunomia.”
Recommendation
Commenting ahead of the meeting next week, councillor Jonathan Nunn, acting leader of Northampton borough council, said: “We looked in detail at the different options available for providing these critical services to make sure that we are aware of the latest and best approach to them. This assessment was carried out for us by exerts in the field of waste management, and to be certain that the assessment process was thorough, PWC our Internal Auditors were also asked to take a good look at it. Following consideration of the findings, we have decided to recommend to Cabinet that the council continues to out-source.”
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Source: letsrecycle.com Waste Managment
