Brent Executive is to consider a proposal to remove the processing of dry recyclable (blue bin materials and deposit banks) from Veolia's current contract in order to reduce costs and make money from the sale of the materials. An officers' report points to Harrow's success in this area but notes:
However, Brent is unlikely to be able to achieve financial outcomes as good as Harrow, because Harrow’s local circumstances give them particular advantages. Their collections are made ‘in-house’ and the waste is transferred to their own depot and handled by their own operatives. Although they incur costs in doing this which must be offset from the income received, they do not rely on the intervention of a ‘middle-man’ as Brent must do through Veolia. Veolia’s costs of handling the collected waste at their depot must still be met.There has been no comment from Brent Council on the collapse of the 4 borough public realm contract which include recycling and waste management but there are clear implications for this proposal. It is interesting to note the advantages that accrue to Harrow from having the service 'in house' and that is something Barnet has also decided to do. There is already a local MRF in Brent, Seneca/Careys based between Wembley and Neasden who attracted criticism in the summer for the Neasden stink.The demand and price of recycled material is subject to extreme fluctuations and also subject to the extent of contamination from co-mingled collections.
Veolia have previously indicated this accounts for the greater part of the present gate fee. Nevertheless, each £1 reduction in this fee this represents a betterment to the Council of between £18,000 and £21,000 before any further benefit is generated from the sale of the material.
To enable this, officers must extract the processing element of the service from Veolia, i.e.make a switch from their MRF at Southwark and reach agreement with a separate third party for the receipt and processing of the waste they collect. Veolia have previously indicated they would not resist this approach, but this must be confirmed through consultation.
The council expects to collect a minimum of 18,500 tonnes of dry recyclable waste in 2012/13, rising to around 21,000 tonnes in 2013/14. At the present level of gate fee this will cost £407,000 rising to £462,000. The objective of this procurement exercise is to reduce that cost significantly.
To enable this, officers must extract the processing element of the service from Veolia, i.e. make a switch from their MRF at Southwark and reach agreement with a separate third party for the receipt and processing of the waste they collect. Veolia have previously indicated they would not resist this approach, but this must be confirmed through new negotiation.
