Malvern Hills district council looks set to pull out of a joint waste and recycling collection contract procurement with neighbouring Wychavon council, after a report claimed there is ‘no financial benefit’ to outsourcing the service.
Instead, the Worcestershire local authority is due to consider reducing the frequency of refuse collections and retaining the in-house service in order to find £250,000 worth of savings per year.
Malvern Hills will continue to collect its waste and recyclables using an in-house service, if councillors approve the proposal at a meeting next week
The recommendation has been put forward in a report by council officer Phil Merrick, and was considered by members of the council’s Overview and Scrutiny committee on Tuesday (7 February). Councillors will vote on the proposal at an executive committee meeting next week (14 February), before a final decision is due to be made at a meeting on 21 February.
Malvern Hills, alongside Wychavon district council and Worcester city council, agreed to jointly outsource collections in 2015 in a bid to save £1.5 million per year.
Wychavon already outsources its collections to FCC Environment, and the three councils had planned for a contractor to take charge of collections once the arrangement expired in September 2017 (see letsrecycle.com story).
However, in May last year Worcester city council called a halt to the plans following a shock administration change at the local elections, in which the Labour Party took majority control (see letsrecycle.com story).
Malvern Hills and Wychavon have meanwhile continued the procurement exercise, with a shortlist of three potential bidders believed to have been drawn up.
Procurement
But, Malvern Hills council officers have calculated that all three bids are ‘significantly more expensive’ on a like-for-like basis when compared with the cost of the current in-house service.
At present, the in-house service has been budgeted at £2.56 million in 2017/18, including vehicle depreciation. Against this benchmark, the private bids are between £400,000 and £690,000 more expensive.
The report notes: “It is clear from the robust process that we have undertaken jointly with Wychavon that for Malvern Hills there is no financial case to outsource the waste, recycling and street cleansing service based on the prices provided.”
Collections
Under its Business Plan, the council must still locate £250,000 of savings in its waste budget in order to plug a £1.8 million gap in its budget by 2019/20 – which it has blamed on ‘government funding cuts’.
“What the exercise on the joint waste contract has shown is that this council already operates a very efficient and cost-effective waste collection service that the private sector is unable to match and our staff should be congratulated on that.”
Cllr Bronwen Behan
Malvern Hills council
While £100,000 has already been identified for the 2017/18 financial year via ‘increased income and cost savings’, the council will still need to raise £150,000 the following year.
The council will therefore consider reducing the frequency of residual waste collections from weekly to fortnightly, and replacing residents’ black sacks with wheeled bins from April 2018.
The purchase of 30,000 black bins is expected to cost the council an estimated £600,000, which the report claims will be raised from a projected £550,000 underspend in the revenue budget for 2016/17. The council has also only spent £10,853 of the £50,000 allocated to support the procurement process.
Cuts
Commenting on the report, councillor Bronwen Behan, portfolio holder for environment on Malvern Hills district council, has warned that retaining weekly collections will result in ‘significant cuts’ to all other services.
She added: “What the exercise on the joint waste contract has shown is that this council already operates a very efficient and cost-effective waste collection service that the private sector is unable to match and our staff should be congratulated on that.
“We’ve made no decision about that yet and we’ll take the time we have to study all the options and implications before agreeing a way forward.”
In 2015/16, Malvern Hills council achieved a combined recycling, composting and reuse rate of 38.3%.
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Source: letsrecycle.com Waste Managment
