Agenda item - Revised Funding for the Waste Management Contract

(Environment Portfolio Holder) To consider the attached report (C-049-2016/17).

(1) That in order to respond to cost pressures on the Council’s Waste Management service, the following District Development Fund and Continuing Services Budget supplementary estimates for 2016/17 be recommended to the Council for approval:

(a) a sum of £90,640 from the District Development Fund to meet the costs of additional dry recycling sacks for the period July 2015 to March 2016;

(b) a sum of £202,654 from the District Development Fund to meet the costs of a change in the composition of the dry recyclable materials collected for the period November 2015 to March 2016; and

(c) a sum of £64,000 from the District Development Fund to meet the costs of the increased number of properties within the District for the period November 2014 to March 2016; and

(2) That a Continuing Services Budget Growth Bid in the sum of £343,903 from 1 April 2016 for 2016/17 onwards be agreed comprising of:

(a) £120,853 for dry recycling sacks;

(b) £143,050 for the change in the composition of the dry recycling materials collected; and

(c) £80,000 for additional properties;

(3) That a formal amendment to the Waste Management Contract be made to address any changes in composition of dry recycling materials in future to ensure the Council could gain financially if the quality of materials collected improved; and

(4) That a further report be submitted to the Cabinet to consider service change options that could be used to mitigate the increased costs in relation to recycling sacks and composition change for the future years of the contract.

In the absence of the Environment Portfolio Holder, who had tended his apologies for the meeting, the Portfolio Holder for Safer, Greener & Transport presented a report on revised funding for the Waste Management Contract.

The Portfolio Holder stated that a number of cost pressures on the Waste Management service had been building since the new contract was awarded in November 2014, which had only been fully highlighted over the last few months due to the initial focus being on improving the quality of the service. The main additional cost considerations were the composition of dry recyclable materials collected, the number of dry recycling bags issued and the implications of the number of additional properties required to be serviced, from the start of the contract. These had now resulted in a variation request by Biffa to the Council, which, under the terms of the contract, needed to be formally considered. If agreed, the Council would be liable to pay Biffa an extra £357,294 and it was proposed that this should be met by the District Development Fund. In addition, it was also proposed to increase the value of the contract from 1 April 2016 to take account of these factors in the future, and for the current contract to be formally amended to ensure the Council would gain financially if the quality of the recyclable materials collected improved in the future.

The Portfolio Holder reported that the following options for service changes were presented to the Waste Management Partnership Board at their last meeting:

(i) the provision of additional, chargeable bins for mixed organics;

(ii) the introduction of Biffa’s ‘Green Waste Club’ and separate food waste collection;

(iii) the introduction of a third wheeled bin for dry recyclates; and

(iv) the introduction of a third wheeled bin for dry recyclates and glass.

Three of the above options had the potential to both increase recycling performance and reduce the cost of the contract to the Council. Therefore, it was proposed to submit a further report to the Cabinet later in the municipal year to consider service changes for future years of the contract.

Cllr Mohindra, as Finance Portfolio Holder, highlighted that these additional sums of money were contractual rates which the Council had little choice but to pay, and strongly urged the Cabinet to support recommendation 3 where the contract would be amended to benefit the Council if the quality of the collected recyclable materials improved.

In response to questions from the Members present, the Assistant Director of Neighbourhoods (Technical Services) explained that the composition of the recyclates collected had changed since 2013 when the then figures were given to Biffa; less weight was being collected, less paper and more cardboard was being collected which was less valuable. The Assistant Director did not have figures for the value of the recycling sacks as recyclates, and would investigate whether this could be extracted. The proposals was to pay Biffa the additional monies from November 2015 onwards, and not for the first year of the contract. The growth bid for the Continuing Services Budget included provision for future uplifts in the cost of the contract. There were more outlets now where residents could obtain further recycling sacks and these would be consulted by the Council when reviewing the options for future service delivery; residents would be informed once a firm decision had been made.

The Cabinet was not surprised that the number of dry recycling sacks required by residents had risen and felt that the annual delivery of recycling sacks should continue until the further report on service change options had been considered. The Leader of Council opined that any new service delivery methodology should be trailed first before being implemented across the whole of the District, with perhaps the provision of further education for residents regarding recycling as well.

Decision: