It is understood that the complaint has been made on the grounds that the contract discriminates unfairly against smaller firms who could not bid for the contract because of its large size. The complainant is believed to consider that smaller firms could normally bid for contracts offered by one council but the grouping of the sale of recyclables into one large contract covering several local authorities could mean that only larger businesses would be able to bid for the material.
A spokeswoman for the OFT confirmed to letsrecycle.com that a complaint had been made. “At this stage we can confirm that we are seeking information about the contract. This does not mean that the contract is anti-competitive or that we are investigating it.”
Bids were invited last year for the contract by the Midlands Recycling Consortium – which includes Warwickshire County Council, Daventry district council, Kettering borough council, Leicestershire county council, Northamptonshire county council and other local authorities in the area – for the 12,000 tonnes of recovered paper generated by the councils each year. Contractors could offer to collect the paper or simply receive it at their yards or mills.
WRAP support
The consortium is supported by the Waste and Recycling Action Programme which has facilitated the coming together of the local authorities involved. WRAP itself took legal advice over the sale of recyclables when it was first set up. At issue then was the legal issues surrounding the sale of materials and Chris Davey, WRAP's manager of local authority relations said that opinion from counsel was that “there was a big difference in selling recyclables than in procuring services”.
Legislation
A spokesman for DEFRA said that the Department was not aware of legislation covering the sale of recyclables and referred inquiries on the matter to the Office of Fair Trading.
The contract is being organised by the Eastern Shires Purchasing Organisation (ESPO) which is involved in local government procurement. However, this is thought to one of its first ventures into the sale of recyclables which are one of the few products actually sold by a local authority. Ed Walsh, ESPO's commercial manager (strategic procurement) was unavailable for comment.
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