12 April 2018 by Elizabeth Slow

Support expressed for in-house services

Councils and organisations have supported the business case for bringing waste services in-house in the wake of a campaign by the ESA over competitive tendering.

A recently launched campaign by the Environmental Services Association (ESA), claimed that projected savings from in-house and Teckal solutions are often an “illusion”.

Liverpool city council is one authority which has brought its waste services back in-house

And, the trade body, which represents private firms in the waste sector, highlighted advantages that councils can gain when they take advantage of competition through procurement of a private sector contract.

In response, Mo Baines, head of communication and coordination at APSE – Association for Public Service Excellence – said, over a number of years the outsourcing model has exposed “a number of flaws”.

“Research by APSE has shown time and again that the primary reasons for insourcing a service is service efficiency, service quality and increased customer satisfaction,” Ms Baines said.

“The disconnect between local elected councillors being able to take a proactive and interventionist role in making sure public services are responsive to local residents is not something that can be easily translated into outsourced service contracts,” she explained.

‘Popular option’

“Ultimately, whilst service models are for local councils to decide insourcing and consideration of in-house models of delivery is certainly a worthwhile and an increasingly popular option.”


Mo Baines
APSE

“Ultimately, whilst service models are for local councils to decide insourcing and consideration of in-house models of delivery is certainly a worthwhile and an increasingly popular option.”

Commenting on outsourcing more generally, Trade union Unite’s acting national officer for energy and utilities, Peter McIntosh, said: “In general, Unite believes that outsourcing of public services to private companies does not bode well for the customers and the workers. The only groups that appear to benefit are the company bosses whose pay goes through the roof and the shareholders who gobble up a disproportionate share of the profits.

“You only have to look at the recent collapse of the outsourcing giant Carillion for the stark evidence that outsourcing of public services can be a disaster, with workers paying with their jobs and the taxpayer picking up the tab for the fall-out. The ESA management needs to learn from the lessons of Carillion.”

On the council side, Bristol city council has reinforced its decision to pass its waste services over to Bristol Waste Company – a business set up by the authority.

A spokesperson for Bristol city council said the decision to award Bristol Waste Company the Integrated Waste Service contract followed a short term trial period “during which the company demonstrated the benefits and efficiencies associated with this model of service provision”.

The council continued: “These include a more affordable service, greater efficiency by being responsible for the full end to end process and an ability to generate income through growing commercial waste services.”

Bristol city council awarded a 10-year contract to Bristol Waste Company – a business set up by the authority

And, in Liverpool, the authority said bringing its waste collection, street cleansing and highways contract back in-house has been the “right move both for the council and the people of Liverpool”.

“We continue to believe that this approach delivers the best service possible for the people and businesses of Bristol.”

These services are now controlled by an arm’s length company – Liverpool Streetscene Services Ltd.

In explanation, the council said: “It means we have been able to deliver a level of service that meets the needs and expectations of our customers. It also means we have been able to deliver savings that have been directly re-invested in services.

“Importantly, we have involved the Trade Unions in the decision making process from the outset and they have reacted positively to our need to innovate and change the way we work.”

ESA view

The ESA has emphasised that it believes that competition for contracts can bring benefits to local authorities and that different contract options are now available for local authorities.

“By transferring risks to the private sector, local authorities are able to insulate themselves from unforeseen costs and gain greater certainty over their budgets.”


Jacob Hayler
ESA

Commenting on the official launch of the campaign yesterday, ESA’s executive director, Jacob Hayler said: “ESA agrees that councils are best placed to decide how they want to manage these trade-offs, but we believe that the market is best placed to deliver value for money.

“By transferring risks to the private sector, local authorities are able to insulate themselves from unforeseen costs and gain greater certainty over their budgets. The risk for delivering a quality service to cost lies with the contractor and is enforced through its legal obligations under the contract. This provides transparency and accountability in the delivery of the services, which improves outcomes for council tax payers.

“We believe that competitive tenders – open to both private and publically owned service providers – can be used to protect councils from changes in future legislation in the most affordable way.”


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