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Decision details
Tendering Strategy - Waste and recycling contract form 2013
Decision Maker: Cabinet.
Decision status: Recommendations Approved
Is Key decision?: Yes
Is subject to call in?: Yes
Purpose:
To consider the tendering strategy for the new waste and recycling contract, together with proposals for street cleansing due to start in August 2013 and approval to commit to a joint procurement with Ashford and Swale Borough Councils.
Decision:
1 That the joint procurement arrangements as set out below be agreed.
2 That the principles of financial disaggregation asset out below be agreed.
3 That delegated authority be given to the Director of Change, Planning and the Environment, in consultation with the Head of Legal Services and Cabinet Member for Environment, to agree the Inter Authority Agreement and enter into the agreement on behalf of the Council for a ten-year partnership with Ashford and Swale Borough Councils and Kent County Council (KCC).
4 That approval be given to commence the joint procurement of Waste Collection Services, to include refuse and recycling and the mechanical sweeping element of the street cleansing service.
5 That this Council takes the lead on the procurement process, managing the various processes, be agreed.
6 That delegated authority be given to the Director of Change, Planning and the Environment in consultation with the Head of Legal Services, to agree and enter into a separate agreement with Canterbury City Council for its inclusion in the procurement exercise but on the basis that there would be no detriment to the Council based on the financial disaggregation in the report.
7
That the responses to the Scrutiny Committee
Recommendation action and Implementation Plan (SCRAIP), as attached
at Appendix A, be agreed.
Reasons for the decision:
Following a best value review of refuse and recycling in 2009,
the Council adopted a five-year Waste and Recycling
Strategy. This built on the work of the
Kent Waste Strategy which the Council had signed up to, but
identified the specific direction for waste and recycling to be
reflected in the new contract arrangements for 2013.
The
Strategy identified specific key elements:
i) To increase the amount of household waste sent for recycling, re-use or composting to 50% by 2015 (above the national target of 45%.
ii) To reduce the total household waste arisings by 10% by 2015 compared with 2005-2010 average.
iii) To meet any additional costs of operating the service through the support of the Kent Waste Partnership and efficiency improvements on the rest of the waste collection service.
iv) To improve the value for money of the waste collection service.
v) To improve residents’ satisfaction with Maidstone Borough Council’s waste and recycling services.
vi) To increase glass recycling by up to 600 tonnes during the period of the plan.
vii) To work with KCC to minimise the amount of recyclables sent for incineration and maximise the benefits of the value of those materials for both the Council and KCC.
viii) To support the
Council’s objective of 3% annual carbon reduction through the
optimum utilisation of resources, increased consideration of energy
efficiency and higher priority given to service improvements which
offer energy reduction.
The
proposals identified in the report of the Director of Change,
Planning and the Environments will help deliver the targets and
improvements in all eight of the elements of the
strategy.
The Council’s refuse and recycling collection contract is due to be re-tendered in 2013 and discussions have been held with other adjacent authorities whose re-tendering timescales coincides with Maidstone’s i.e. 2013. This has led to the establishment of a Mid Kent Joint Waste Partnership (MKJWP) to consider the possibility of a joint procurement.
This
project follows on from the East Kent Joint Waste Project which
provided waste/resource Collection and Street Cleansing Services
for Dover and Shepway District Councils, as well as food, garden
and dry recyclate processing services
on behalf of KCC in respect of Dover, Shepway and Thanet District
Councils and Canterbury City Council. It was tendered in 2010 and
the contract commenced on 16th January 2011. The project delivered
an annual joint collection service saving of £900k to both
Dover and Shepway District Councils. Future avoided disposal
savings are dependent upon tonnages and movements in recyclate values but are forecast to average
£2.9m p.a. from 2013-2021 in East Kent.
The tendering exercise will also consider the environmental aspects of collection arrangements, seeking ways to minimise carbon emissions and seeking innovative ways to use the recyclates that are collected.
The
MKJWP encompasses the following districts in Kent that are renewing
collection contracts in 2013:
District |
Current Contract End Dates |
Ashford Borough Council |
31st March 2013 |
Maidstone Borough Council |
31st July 2013 |
Swale Borough Council |
13th December 2013 |
In
order to maximise the efficiency of the collection contract
arrangements and to ensure the three contract areas finish at the
same time, it is proposed that the partnership and contract
arrangements continue for a period of ten years up until
21st October 2023.
The MKJWP seeks to provide the most cost effective means of collection and processing waste/resources. Learning form the experiences in East Kent the proposed collection methodology would provide for the following:
· Weekly Food Waste Collection;
· Fortnightly Dry Recycling Collection; and
· Fortnightly Residual Waste Collection.
To
minimise collection costs the food waste is collected separately
but on the same vehicle that provides for the residual waste and
dry recycling collection service. To maximise the value of the
recyclate and minimise material
recycling processing costs mixed paper and card is collected
separately from glass, cans, plastic and tetrapak. This is being achieved on the same
vehicle using split backed collection vehicles.
It is proposed that the collection of Garden Waste is included in the contract and will continue to be available at a charge.
There
is still a national debate regarding the provision of weekly
collections and the Government has recently introduced incentives
for authorities with fortnightly collections to revert to weekly
arrangements. However, the Council has
already introduced a very successful weekly food collection with
fortnightly dry recycling and residual waste
collections. This has proved very
popular with the public with participation around 80%. There are therefore no proposals to change these
arrangements.
The proposed collection method is referred to as the Preferred Collection Methodology or PCM and the key difference between this and the current arrangements in Maidstone will involve separating the dryrecycling to maximize the value collected. An insert or similar will be provided to go into the dry recycling bin in which paper will be separately stored prior to collection. In addition, glass can be placed in the recycling bin, although residents will still be able to utilize the glass bins across the district. The cost of the containerisation is to be provided by KCC.
Maidstone is currently achieving recycling rates in the mid 40%
and this has reached 50% in times of high composting. However, the Government Waste Policy in England
2011 reaffirms the need for councils to increase their recycling
rate to ensure, at the very least, meeting the EU framework
directive of 50%. The Council has set a
target of 50% by 2015, in the adopted Waste and Recycling
Strategy.
It is possible that alternative collection methods may be proposed, if during the course of the tendering process greater collection/disposal savings can be delivered by adopting a variant to the PCM.
Street
cleansing is also included in the current Waste Collection Services
for both Ashford and Swale and the tender documents for these
authorities will include both refuse and recycling collection and
street cleansing. Both currently have
an external contractor.
In Maidstone, the street cleansing service is provided ‘in
house’ and the merits of this compared with an external
contractor are considered at Appendix 1 to the report of the
Director of Change, Planning and the Environment.
In summary, the flexibility of the current arrangements combined
with good performance and low price support the retention of the
‘in house’ service.
However, it is recognised that there could be good opportunities
for combined operations for mechanical sweeping and thereby good
levels of potential savings. Whilst
slightly increasing the complexity of the management of the
service, this is considered the best option for the
Council.
A
detailed project review has been prepared by consultants working
for the Kent Waste Partnership which identifies the potential
savings of a joint procurement arrangement. This is provided in the Exempt Appendix to the
report of the Director of Change, Planning and the
Environment. The modelling that has
been undertaken has used prices from the tendering process
undertaken for the East Kent Project.
In
order to achieve the significant savings identified and to reflect
the other benefits of partnership in the form of cross boundary
operation, improved recycling rates and likely improved customer
satisfaction. It is therefore proposed that the Council enters into
an agreement with Ashford and Swale Councils for the joint
procurement of a waste collection services contract, comprising of
the refuse and recycling services and mechanical sweeping element
of the street sweeping services to commence on 1st
August 2013 and ending on 13th October 2023.
The changes to the current refuse and recycling contract can be summarized as follows:-
· The existing collection arrangements for the householder remain predominantly the same:
Weekly food waste collection
Fortnightly dry recycling
Fortnightly residual waste
· Paid-for garden waste collection
· The specific change, subject to the detailed procurement outcome, is that in order to extract the maximum value of the recyclate, an insert will be provided in the recycling bin to allow the separate storage and collection of waste paper. It is also envisaged that glass will be able to be placed in the recycling bin.
·
There will be no other additional bins
required.
It has
been modelled that this should increase the Council’s
recycling rate to just above 50% which is in accordance with
Government policy and will ensure the Council is in the top
quartile of performance when compared to other districts.
The
financial benefits to the Council are summarized in the Exempt
Appendix to the report of the Director of Change, Planning and the
Environment.
Alternative options for a stand-alone tender, a partnership with
one other authority and a co-mingled collection of recyclates have been considered and these are
detailed at Appendix 2 to the report of the Director of Change,
Planning and the Environment. However, the PCM and partnership procurement offer
the best financial option for the Council.
It is
therefore considered that the potential savings are so significant
that the Council should enter into the joint procurement
arrangements and the Inter Authority Agreement for a ten-year
partnership with Ashford and Swale Councils.
The
savings for street cleansing are modest in the region of £70k
and by retaining the in-house service,
the Council will retain the flexibility of its own workforce which
is currently performing well.
A draft
Inter-Authority Agreement (IAA) is attached at Appendix 3 to the
report of the Director of Change, Planning and the Environment . The
objective to this agreement will bind the four authorities to the
procurement arrangements and financial disaggregation of the joint project with KCC set
out in this report. Delegated authority
is requested to agree the final version of the IAA and enter in the
agreement on behalf of the Council.
It is
proposed that each of the four authorities will seek agreement to
enter into the partnership and the notice regarding the procurement
will be published in October, in accordance with the timetable
necessary to have the new contract arrangements in place by August
2013.
It has
been agreed that, subject to each authority agreeing the proposals,
Maidstone will act as the procuring authority and officers will
work on the specific tender documents. All costs are to be met by
KCC and it is recommended that this be supported.
As recently as the last week in September 2011, Canterbury City Council has expressed a wish to be involved in the joint procurement arrangements. This would require a separate agreement between the current three partners and Canterbury.
However, the detailing modelling of the impact of including Canterbury has not been undertaken, although the consultant’s initial view is that it should further improve the savings potential for all partners. It is therefore proposed that the Director of Change, Planning and Environment, in consultation with the Head of Legal Services, enter into a separate agreement with Canterbury City Council regarding its inclusion in the procurement exercise but on the basis that there would be no detriment to the Council based on the financial disaggregating in the report.
In
making the decision set out above, the Cabinet had regard to the
Sustainable Community Strategy.
Alternative options considered:
The
Council could decide to seek tenders independently but this would
not generate the economies of scale of a joint procurement and
would not produce the waste disposal savings to be shared by all
the partners. A summary of the
potential savings is set out at Appendix 2 to the report of the
Director of Change, Planning and the Environment.
Tenders could be sought with just one partner, but again this would not generate the economies of scale of a three way procurement and again, would not produce the waste disposal savings to be shared by partners. A summary of the potential savings of a two partner procurement are set out at Appendix 2 to the report of the Director of Change, Planning and the Environment.
The
Council could decide to operate a different form of collection for
dry recyclables by co-mingling the waste and not separating the
paper. This would not produce the value
for paper recycling as the paper would be
‘contaminated’ and the possible savings would be
reduced. Details are provided at
Appendix 2 to the report of the Director of Change, Planning and
the Environment.
It would be possible to seek a tender for street cleansing and this could form the modelled work providing an additional modest saving. However, this does not provide the flexibility currently provided by the ‘in house’ service and is therefore not recommended.
Reason Key: Expenditure > £250,000;
Wards Affected: (All Wards);
Details of the Committee: None
Representations should be made by: Letter e mail
Consultees
Cabinet members
Contact: Steve Goulette Email: Stevegoulette@maidstone.gov.uk.
Report author: Steve Goulette
Publication date: 12/10/2011
Date of decision: 12/10/2011
Decided: 12/10/2011 - Cabinet.
Effective from: 21/10/2011
Accompanying Documents:
- Waste & Recycling Appendix A to the Decision PDF 34 KB View as HTML (1) 11 KB
- Cabinet, Council or Committee Report for Tendering Strategy - Waste and recycling contract form 2013 PDF 84 KB View as HTML (1) 73 KB
- Appendix 1 PDF 96 KB View as HTML (2) 34 KB
- Appendix 2 PDF 21 KB View as HTML (3) 20 KB
- Appendix 3 PDF 270 KB View as HTML (4) 124 KB
- Appendix 4 PDF 34 KB View as HTML (5) 24 KB
- Appendix 5 PDF 23 KB View as HTML (6) 26 KB