Portsmouth’s existing eight-year waste collection contract with Biffa began on 1 October 2011. The original deal contained a two-year extension clause activated by the council, who have subsequently extended the deal to March 2024.
Council officers looked at a range of options during the cabinet meeting, including outsourcing and a shared services organisation, where two or more local authorities work together.
A report by James Hill, Portsmouth’s director of housing, neighbourhood and building services, says Biffa “performed well” over the course of the contract.
The report says the deal’s ‘open book nature’ means Portsmouth has a “full understanding” of costs, while the council also has experience of developing other in-house services such as cleaning and grounds maintenance.
Portsmouth learnt through a soft market testing exercise that a potential outsourced deal would be “more attractive” if it included options to add in street cleansing or provided an opportunity for other local authorities to join the contract for additional services, such as food waste collection. These options did not appeal to the council.
Explaining the in-house move, Cllr Gerald Vernon-Jackson, Portsmouth city council’s leader, said: “The decision will give us greater flexibility in how we manage the service and will give the staff who work on domestic refuse and recycling collection for Portsmouth additional benefits in working for the council.”
Portsmouth said it would work with Biffa to make sure all staff who are “dedicated” to the council contract at the time of transfer become its employees.
‘Pragmatic not ideological’
Cllr Vernon-Jackson thanked Biffa for their response during the pandemic, saying they delivered “largely uninterrupted” collections and rolled out an additional food waste service (see letsrecycle.com story).
Having the service in-house will allow us to make further improvements over coming years
– Cllr Kimberly Barrett
He said: “Our decision is pragmatic not ideological. We will look at whether to bring services in-house on a case-by-case basis and we believe the decision today will benefit Portsmouth residents in the long term.”
Cllr Kimberly Barrett, Portsmouth’s cabinet member for climate change and environment, added: “Having the service in-house will allow us to make further improvements over coming years to benefit Portsmouth residents.”
Soft market testing
A project team comprising waste management, legal, finance and procurement officers has been evaluating the options for future service provision.
This includes a soft market testing exercise with five of the UK’s “major” waste management companies – Biffa, Veolia, Viridor, FCC and Serco – for the contracted-out option, alongside research with other in-house teams to understand the challenges better.
Each of the five waste firms indicated that, although Portsmouth is not one of the largest contracts available, it would still be “of interest” in terms of bidding, the report says.
All the contractors highlighted the compact nature of the city as a “positive”, the report says, though they suggested the narrow nature of some of the roads could restrict vehicle choice. They were also aware of the “transient nature” of the student population.
The project team learnt there were “fewer companies in this market than 10 years ago”, the report says, with most contracts attracting three or four bidders compared to seven or eight in years gone by.
The project team also met with two other waste management Teckals – a trading company formed by a local authority to deliver services and trade commercially to generate income – to learn about their experiences and some the challenges involved.
Representing an estimated population of nearly 250,000, Portsmouth city council had a household waste recycling rate of 24.7% in the 2020/21 financial year, the most recent available data.
The council collects residual waste weekly and recycling fortnightly. There is also a network of bring banks for glass, textiles and cartons.