Peterborough city council has stepped up its preparations for moving waste collection services in-house as its contract with Amey comes to an early end next month (February 2019).
However, the authority has noted that the move could come at “an additional cost to the council” over the next three years.
The council’s cabinet met in an extraordinary meeting last month to discuss how the local authority trading company which will operate the service, named Peterborough Ltd, will function.
The new in-house company will take over a range of environmental services across the city, including waste collection, street cleaning and ground and buildings maintenance. This comes after the council and Amey ‘mutually agreed’ to end their 23-year contract for the work.
Peterborough awarded its waste and recycling collections work to Enterprise in January 2011, absorbing staff from the council’s then in-house collection service (see letsrecycle.com story). The council did not disclose the value of the contract at the time.
In 2013, the contract transferred to Amey following the Spanish-owned waste firm’s acquisition of Enterprise for £385 million (see letsrecycle.com story).
However, “unprecedented market challenges” led to an agreement between the two in 2017 to end the deal 15 years early.
According to documents disclosed ahead of the meeting last month, Peterborough Ltd will need between £10-11 million per year in funding over the initial five years of operation to deliver the services. This includes £10.4 million in the 2019/20 financial year and just over £11 million in 2023/24.
It was also revealed that for the first three years of operation, the company will need an additional £2.6 million of funding compared with the ‘base budget’ set out in the council’s medium-term financial strategy.
“The delivery of the Services by Peterborough Limited will be an additional cost to the council as the base budget is lower than both what is being paid to Amey at the moment for which additional budget has been agreed, and the proposed budget of Peterborough Limited,” the minutes said.
However, the council said that “Peterborough Limited has plans in place to start to grow commercial income with the creation of a commercial budget to deliver these plans”. A loan between the council and the new company will also be in place to help with start-up costs.
In terms of the service offered, the council has given no indication that this would change. Currently, an alternate-weekly collection system is in place for residual waste one week and mixed recyclables the following week, with a weekly food waste collection across most of the authority’s area.
Separately residents can opt into a paid for garden waste collection service, collected the same week as the recycling container.
Peterborough city council added that it continues to undertake consultation with relevant stakeholders including: trade unions, affected EMS staff, Cabinet Members and the Corporate Management Team over the switch.
The move in-house by Peterborough comes on the back of a number of councils considering similar steps recently.
Cheshire West and Chester council will consider on Monday (18 January) whether to move its service in house after Kier asked to bring its contract to an end (see letsrecycle.com story).
Elsewhere, in November 2018, Tower Hamlets opted to bring its services in house, while Corby borough council announced the following month it will be moving its waste and recycling services to an in-house contract as part of a merger with Kettering.