The Problem
The council have set out ambitions to deliver £51m of savings within the current financial year, of which £4.3m is attributed to Waste Management and the Waste PFI contract with Veolia specifically. In addition to this, the council has also made a number of wider strategic commitments in ‘The Shropshire Plan’, some of which relate to waste management. Therefore, the objective of this project is to support the council to understand the options and delivery plans to help deliver savings in the current financial year, but also consider the longer-term approach to enable the delivery of strategic commitments and drive long-term sustainability.
What is the project about?
Public Finance Initiatives (PFI) were a way of financing council infrastructure projects through private sector investment to reduce the burden on the council providing the capital cost for the infrastructure upfront. The money required to build the infrastructure is provided by the private sector which is then paid back by the council over a long period of time through a contract.
The council entered in to a PFI contract with Veolia in 2006, this was an integrated waste contract that includes both the collection, disposal, treatment and recycling of household waste across Shropshire. This also includes the household waste recycling centres, waste transfer stations, depots and the Battlefield Energy Recovery Facility which was operational in 2015. The provision of these services to the council is at an annual cost of £34m.
Why does this matter?
It is important that we review our long-term contracts to ensure that they are still fit for purpose considering new changes in best practice and legislation and that they continue to deliver value for money for our local taxpayers.
It is important that both residents and businesses across Shropshire reduce and minimise their waste, protecting our natural resources and reducing our environmental impact. The more waste we collect, particularly household waste, the more we pay Veolia to dispose and treat it, which means taxpayers will continue to pay at the highest level in each council tax band.
How will the project be implemented?
A number of options will be considered, and a delivery plan will be agreed with Cabinet, based on several criteria such as the risk, costs, benefits, deliverability and timescale.
Who is involved?
This project involves a range of stakeholders including Cabinet, external advisers, Veolia and other third-party suppliers. There is a Waste Project Board consisting of senior officers and external advisors who will drive the savings for this financial year whilst also considering ongoing savings and service improvements.
When is it happening?
This project is already in the initial options/planning phase with the next step to develop the agreed delivery plans.