They stuck with Veolia to save £800,000 a year but East Cambs Council now says 'we can do it cheaper' as they bring waste contract 'in house'
PUBLISHED: 15:10 14 March 2017 | UPDATED: 15:10 14 March 2017
Three years after sticking with Veolia to collect household waste, East Cambridgeshire District Council say they've now found it can do the job cheaper themselves.
Veolia, whose initial seven year contract was awarded in 2008, will end its association with the council next year following completion of a four year extension.
East Cambs will revert to direct labour to run the service with staff from Veolia being transferred over to the council’s new trading arm.
Ironically when East Cambs looked at the waste scheme three years ago it estimated that by staying with Veolia would save it £800,000 a year.
Councillor Julia Huffer, waste champion for East Cambridgeshire District Council, said: “We have spent a lot of time looking at options beyond the end of Veolia’s contract.
“We believe that direct provision of services is definitely the way ahead. It will give us greater control over services and flexibility to make future improvements.
“We will no longer be paying a contractor’s profit margin and will be able to reinvest savings to provide better services for local residents.”
Councillor Anna Bailey, chairman of the regulatory and support services committee, told councillors last month there had been some nervousness about this subject as it was the biggest single contract of the council.
However she felt the proposals gave flexibility for the future and quality could be directly controlled; it also fitted with the council’s commercialisation agenda. Cllr Bailey said not only would the council to be able to control costs the profit element to an external company would be removed.
Risk mitigation and monitoring would be important, she said, although Councillor Lorna Dupre had qualms about potential conflicts between the company and the council.
She also felt the council needed to be nimble about a future move to cleaner hybrid vehicles as a positive contribution to the environment and requested residents be offered a second blue bin to encourage more recycling.
Councillor Bill Hunt backed the move – he said the interests of the council and the company were the same as the former appointed directors to the trading arm board.
Jo Brooks, director of operations at East Cambridgeshire District Council said: “This decision has had very strong support from councillors and has been researched thoroughly to ensure it is the best option for both East Cambridgeshire District Council and for our residents.
“Transferring the service to The Trading Company will directly reduce the amount of money the council spends on waste whilst not reducing the level of service for local people. It will also enable the service to be more flexible to future change. The Trading Company is also committed to achieving the council’s recycling target of 60%.”
As well as saving money on the contract, the move also removes the cost of the required EU procurement process for tendering for a new service delivery provider – an additional saving of around £250,000.