Councils urged to consider bringing waste services in-house

Published last week, the report claims that examples of councils that had successfully in-sourced services such as waste and recycling collections offered “compelling” reasons for either retaining or bringing work in-house.

APSE claimed there was “mounting evidence” that councils were bringing services back in-house, and said that the research detailed in the report proved that in-sourcing was “a valid option requiring serious consideration by local authorities”.

As such it called on councils to be aware of the potential benefits to be gained from in-sourcing, such as cost-efficiency, flexibility and quality of services.

Commenting on the research, APSE's chief executive, Paul O'Brien, said: “The days where it was unfashionable to question the value of outsourced services are over. In these turbulent economic times local authorities are looking at all options available to them and what this research shows is that over fifty of them have decided that based on their experience of the market, it is more economic, efficient and effective to deliver services directly themselves.'

“We are not suggesting in-sourcing should be the only option. But, as times get tighter, the benefits that can be reaped from in-house teams directly delivering local services to local communities must now surely be recognised,' he added.

Case studies

Seven of the 50 case studies detailed in the report relate to waste and recycling collections being brought back in-house, including Three Rivers district council in Kent, which said it had made efficiency savings in excess of £1.5 million by in-sourcing when its contract with Onyx (now Veolia) ended in 2002.

And, the report detailed the experiences of Oldham metropolitan borough council which brought its waste and recycling collections in-house in 2000, when its previous deal with SITA UK ended, to allow it to integrate them with its street scene services.

The other case studies relating to in-sourcing waste and recycling collections were: East Riding of Yorkshire council; East Lindsey district council, Gateshead council, Thanet district council and Wear Valley district council.

Benefits

The report's emphasis on the potential benefits of in-sourcing was welcomed by Alice Roberts, national projects manager at the Waste Improvement Network, who claimed that the flexibility of in-house services was particularly important.

“The critical issue here is that negotiations with a contractor can only happen once, whereas negotiations with your operational arm can happen on more than one occasion,” she told letsrecycle.com.

She added: “We can't assume it's a given that the private sector is more efficient. We see good efficiency in both the public and private sector and bad management in both.”

And, Andrew Craig, principal policy offer at LARAC, emphasised the problems that could be encountered with regards to monitoring out-sourced contracts if a council had been forced, due to government funding priorities, to cut-back on its contract monitoring activities.

“So councils delivering through a contract might not have the resources to monitor it until problems develop,” he explained.

Contractor

However, the report's support for the benefits of in-sourcing was countered by waste management companies seeking to highlight the gains to be made with waste and recycling collections being operated by an outside contractor.

A spokesperson for Veolia told letsrecycle.com: “When compared on a like for like basis, outsourcing will usually be attractive to local authorities. Given the need to meet both EU and Government recycling and landfill diversion targets, outsourcing also provides local authorities with access to our extensive experience and wide-ranging, cost-effective solutions.”

Mike Snell, general manager for external affairs at the Waste Recycling Group, questioned just how many councils would in-source, and claimed that, in the current economic situation, contractors would work even harder to provide value-for-money to councils.

“The benefits of economics, efficiency and service delivered by the private sector in this area are well proven and our view is that local authorities are unlikely to change track significantly now,” he said.

“Private sector companies will also be keen to demonstrate that they can continue to provide excellent value to councils – particularly in difficult economic times,” he added.