Franchise model gains traction at RWM

The calls came during a panel discussion at the annual RWM in Birmingham on: ‘Adapting to budget cuts: Prospects for monetising collection services’.

The audience heard from Jarno Stet, waste services manager at Westminster city council, and James Fulford, director of LBWR who discussed how London could learn from big cities in America who are moving towards using one contractor in large geographical areas to run collection services.

Mr Stet said: “In the UK, we currently have a disjointed approach [to waste collection] and it’s leading to issues in certain areas, especially in London where you have a multitude of contractors coming from different premises and it’s leading to congestion.

“Cities such as New York and Los Angeles have operated a similar model, not with local authority involvement but through competition from private sector providing services.

“But they are moving away from this, as it’s leading to congestion, low recycling rates and costs for businesses. They are working now on a franchise model where there is one contractor that will pick up in a certain geographical area.”

And Mr Fulford agreed, saying: “It makes more sense that New York is letting contracts on regions so that a single provider does all the collection in an area. What that means is less traffic, pollution, lower operation costs and with economies of density, we can afford to provide a wider range of recycling services.”

Financial constraints

The panel’s aim was to discuss how local authorities have developed “innovative strategies in response to ever tightening financial constraints”, according to the RWM.

But Richard Bradbury, head of environmental services for Camden borough, stressed that commercialisation has proven to be challenging.

Mr Bradbury said: “Local authorities are not private companies. They are structured and funded differently, and they are accountable to communities in a different way to private companies.

And Mr Stet agreed, saying that local government is more complex, unlike businesses “where you can make a decision today and its done tomorrow, we have politicians to consider, consultations to be held, responsibilities to residents as well as businesses”.

Mr Bradbury also stressed that local authorities need to change, saying that “in order to achieve commercialisation, local authorities need to identify the right opportunities and partners in the appropriate geographies”.

John Glover, managing director of London-based Bywaters, argued that many local authorities do not know their own costs but adding later that the key to monetising collection services was more collaboration between the private sector and local authorities.

“Let’s try and not reinvent the wheel”, concluded Mr Glover at the end of the session.