28 November 2019 by Claudia Glover

FCC ‘disappointed’ over Allerdale contract loss

EXCLUSIVE: FCC has expressed “deep disappointment” over the termination of its waste contract with Allerdale borough council, and the manner in which it says the council “conducted itself”.

FCC trucks in Allerdale borough in Cumbria before they terminated their waste management contract

The Cumbria council confirmed that it would be ending its contract with Spanish-owned waste management company FCC on 21 November 2019, after indicating in September that it wanted to bring the service in-house (see letsrecycle.com story).

FCC has been working with Allendale since 2003, having acquired the council’s waste contractor Focsa (see letsrecycle.com story ).

In 2018, the council re-tendered its recycling and waste collection services contract and signed a new eight-year deal with FCC on 18 October 2018, worth £22 million.

But, according the FCC, it quickly became apparent that the services agreed on in the initial contract were not adequate to cover the entire borough.

Garden waste and some recycling services were subsequently suspended for two months between July and August of this year (see letsrecycle.com story)

To address this, the council and FCC agreed on an amended contract dictating more services to residents who had been affected.

However, the contract was quickly cancelled a matter of months later, meaning that FCC are to cease work in Allerdale completely on 3 April 2020.

Statement

A full statement released exclusively to letsrecycle.com by FCC today states:

“FCC Environment has today, 27 November 2019, made the following statement in relation to the notification it received on 21 November 2019 from Allerdale Borough Council confirming that it is terminating FCC’s provision of waste and recycling services in the Borough of Allerdale on 3 April 2020.

“FCC Environment can confirm it is deeply disappointed with this decision and also the manner in which Allerdale Borough Council conducted itself during the bid process, the mobilisation of its fundamentally flawed contract and the manner in which elected members have handled attempts by FCC Environment and Council officers to reach a resolution.

“In 2018, the Council re-tendered for a recycling and waste collection services provider and embarked on a tender process in line with standard public procurement regulations. The aim of the newly-shaped service was to provide enhanced recycling throughout the Borough of Allerdale, whilst significantly reducing the cost of providing the service.

“FCC Environment submitted its tender, along with other operators, in line with data contained within the service specification provided by the Council. FCC Environment’s bid was deemed to offer best value. The Council therefore appointed FCC Environment as preferred bidder and accepted its bid on 18 October 2018.

“It soon became clear to all parties that the services procured pursuant to the tender process were not sufficient to meet the needs of Allerdale Borough. Throughout the procurement process, FCC Environment highlighted that there were serious issues with the data provided by the Council within the bid documentation. This issue was debated by representatives of FCC and the Council but the Council concluded that its data, as supplied, was to be used in the bidding process in order to provide a level playing field for all bidders and the Council’s own attempts to model an in-house service.

“The inaccuracy of this Council-owned data is the root cause of the issue and led entirely to the under-resourcing of this contract, as it was relied upon in good faith by FCC Environment.  It became clear, as mobilisation commenced in April 2019, that the service the Council had specified during procurement did not reflect the service actually required on the ground, as FCC had pointed out during dialogue meetings. The data inaccuracies meant around 2,500 properties were missed from the data and a substantial number of the commercial collection services were not included.  This led to a number of households being missed from the collection schedule and incomplete rounds being recorded.

As it became clear how problematic the data sets were, FCC Environment and the Council, including senior officers, established a working group to address the issues. FCC Environment offered a fully-costed and robust solution to enable the Council to provide its residents with the service they had been promised. Indeed, FCC Environment delivered these additional resources at its own cost, as an act of goodwill, for a full three months whilst further analysis was undertaken and a permanent solution was developed. 

“During this time, senior officers at the Council acknowledged the data disparity, even providing drafting for the (unsigned) contract to allow FCC the right to rebase the data and resourcing model. Council officers also agreed to fund the additional cost to deliver the service that was required, but that had not been specified during the procurement process.  Regretfully, the new Council members reneged on this agreement and subsequently suspended part of the service during summer 2019, only to then agree the exact same service as an interim solution two months later, as a result of increasing media and political attention. This is the service which remains in place today.

“Since April 2019, FCC Environment has worked closely with the Council’s officers to manage both the delivery of the service and the communications surrounding the issues this contract has faced. FCC believed it was continuing to work in partnership to reach a resolution.

“On 17 September 2019, FCC learned via local press coverage of the Council’s decision to bring waste collection and recycling in-house, an option which had been considered and deemed unviable by the Council during the procurement process. As formal confirmation has now been received from the Council and a local authority-owned company was incorporated on 19 November 2019, FCC feels it can now break its silence on these extremely disappointing circumstances.

“Media coverage over the summer seeking to lay the blame for problems with the service at FCC’s door is unfounded and based on inaccurate information. Allerdale Borough Council failed to address the omissions and inaccuracies in its own data, which led to an under-resourced contract being let. It is now seeking to defer blame to FCC, which did everything in its power to resolve the issues and, indeed, believed it had provided an acceptable solution.

“After 16 years of providing Allerdale residents with environmental and waste services, it is disappointing that the relationship has come to such an end.  We wish the residents of Allerdale Borough the best for the future and would hope that the Council is able to maintain the high levels of service that FCC have had the pleasure of delivering over the course of our 16 year partnership”.

When contacted by letsrecycle.com, Allerdale borough council declined to comment.

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