Contractors who provide waste management and recycling services can provide a range of solutions for local authorities, writes Jacob Hayler, executive director of the Environmental Services Association.
As austerity continues to bite across the local government sector, councils across the country are searching for every cost saving they can find from every budget they have. This is an era of unprecedented financial challenges for the local government sector, so it is no surprise that councils are increasingly examining all their options for collections services, among everything else.
It appears in the market that more councils are moving away from competitive tender procedures for their waste collections, either by moving services in-house or by using a “Teckal” exemption from the Public Procurement Directives. This is taking away the opportunity for those authorities to take advantage of the market and contestability to drive down costs and to incentivise innovation in service delivery.
Local authorities are under huge pressure to maintain service levels for their residents, improve recycling performance, and above all to save money. ESA agrees that councils are the best placed to decide how they want to manage these trade-offs in collection services, but we believe that the market is best placed to deliver value for money.
Delivering best value through competition
ESA believes that the crucial factor which unlocks best value for council collections is competition. Less important is the ownership of the service provider. Today’s unprecedented financial challenges make it right for councils to explore every option, including the use of a Teckal company. However, on the rare occasions when Teckals for collection services have been exposed to market competition they have been found wanting.
ESA is promoting – through its “Delivering best value through competition” campaign – the use of contestability for collection services to keep downward pressure on costs, which are otherwise on an upward trajectory, and also to incentivise innovation in service delivery. We are not ideologically opposed to public sector ownership – indeed our Association is proud to boast that our membership includes well-established and experienced Teckal operators of large-scale energy from waste plants which add significant value both to their customers and to the Association.
Councils are committed to delivering Best Value for their residents. ESA believes that this is best demonstrated through an open tender process for collections which uses the market to find the best solution for an individual Authority. Experienced contractors will be able to find efficiency savings for councils, bringing down costs while taking on risk so that Authority customers are protected.
Meeting councils’ flexible needs
ESA recognises that many councils are concerned about locking themselves into inflexible arrangements for up to 10 years for their collection services. We are therefore keen to work with the local government sector to explore new contracting solutions which would help to address this.
Good up-front market testing will lead to well commissioned and well procured services. This enables councils to take advantage of competition within the market to attain best value based on their individual circumstances. Well commissioned collection services will include the flexibility that councils need so that the service can adapt to legislative changes over the life of the contract.
Public and private sectors working together
ESA’s Members are committed to finding greater flexibility in outsourced arrangements with new service contracts subject to the same regular tests of performance, cost effectiveness and value for money as Local Authority provided services. We would like to work with our partners across local government to find the best solutions to fit their local circumstances.
ESA and its Members strongly believe that competition and contestability is the surest route for councils to deliver best value in collection services for their residents. We look forward to working with our local government colleagues to gain greater understanding of their concerns and to finding solutions which meet their needs. Above all, the public and private sectors should work together in partnership to provide the best services for residents across the country.
Environmental Services Association