GMWDA defends PFI contract after Pickles criticism

The GMWDA came under attack from Mr Pickles at the New Local Government Networks annual conference last week (January 30) during which he said that councils represented by the Authority faced the double whammy of fortnightly collections and higher taxes.

Speaking at the event, Mr Pickles said: For example, in Manchester, their Council Tax this year is being forced up by a botched PFI deal signed by the unelected waste authority, a 25-year deal which means they are paying double the market rates to dispose of their residual waste, a deal which, despite funding to maintain weekly collections, has forced councils into a double whammy of both fortnightly bin collections for some of its residents and higher taxes.

These details are buried in the small print of Manchester Citys budget this year. A shoddy deal by a shadowy, unelected body, with no-one taking responsibility, and local taxpayers left with service cuts and higher taxes.

He added that it was not local democracy but a municipal autocracy.

Inaccuracies

However, the GMWDA has rebutted Mr Pickles statement and said that it contained a number of factual inaccuracies.

Councillor Neil Swannick, chair of the GMWDA, said it was unfortunate the GMWDA has been branded unelected. He explained that the Authority consists of 19 elected members, with at least two nominated from each of the nine district councils. The majority of GMWDA councillors are Labour. The district councils in the GMWDA are: Bolton, Bury, Oldham, Manchester, Rochdale, Salford, Stockport, Tameside and Trafford.

In response to Mr Pickles comments about the PFI deal, Cllr Swannick said the contract received unprecedented support from the Department for Environment, Food, and Rural Affairs (Defra) and HM Treasury.

Contract

The 25 year recycling and waste management contract with Viridor Laing (Greater Manchester) was signed in April 2009 (see letsrecycle.com story). It was supported by 124.5 million in PFI credits. Since then, 631 million has been invested in new or upgraded waste management facilities.

Cllr Swannick added: When we invested in 2009 we had a straight choice spending around 1 per week per household to build sustainable waste management facilities, or do not build and pay 2 per week per household and pay massive Government penalties through both Landfill tax of 80 per tonne and the Landfill Allowance Trading Scheme (LATS) of 150 per tonne. LATS itself has driven the UK to the point of compliance with the European Unions current Landfill Directive targets, but have been abolished by this Government. That unfortunately means that many local councils faced with delivering savings are going for the cheap landfill option. That is I am afraid short-term gain and longer term pain.

Steep increase

Cllr Swannick said the Authority had flagged up the expected increase in council tax before the contract was signed. He added this was would be reduced in 2014/15.

Our proposed increase of 14.15% in 2013/14 has been very well trailed, and indeed if the Secretary of State for Communities and Local Government had checked just before we signed the PFI in February 2009 we flagged 15.35% for this year, based on 2.5% inflation. We know that the levy is a costly element for our districts spend, however the costs show a steep increase in the first five years but those were approved in the knowledge that increases will be less than inflation for the next twenty years. From 2014/15 we will start the less than inflation period.

He added that the contract was delivering the governments long term vision for sustainable waste management practices. Under the contract, which is in its fourth year, the GMWDA said it is achieving a recycling and composting rate of 40.9% and diverting 57% of waste from landfill.