Clause 47 - Abolition of requirement to contract out waste disposal functions

Part of Clean Neighbourhoods and Environment Bill – in a Public Bill Committee at 2:45 pm on 25th January 2005.

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Photo of Ms Sue Doughty Ms Sue Doughty Shadow Minister (the Environment), Environment, Food & Rural Affairs 2:45 pm, 25th January 2005

I share the concerns about how a council will gradually move away from its current contractual arrangements if it wants to do so. We all recognise the importance of long-term investment, but a stack of issues arise from the existing position. County councils, particularly disposal authorities, are labouring under expensive contracts that are hard to change. Quite rightly, targets on waste arising from European legislation and the agreed need to recycle more and to reduce the amount of waste going to landfill change regularly, but it costs an arm and a leg to change anything in a contract.

The clause does not say that county councils or disposal authorities have to change their contract, but it provides flexibility for councils that want to consider other options. Many councils—possibly waste collection authorities within a disposal authority with which they do not see eye to eye—may want to make separate arrangements because they think that they can get a better, more sustainable deal for the residents of their area. These projects involve huge transaction costs. Local authorities face millions of pounds of legal fees in dealing with the contracts. On occasion, the cost of bidding is enormous.

There seems to be a difficulty in getting standard private finance initiative contracts that councils can use, so everyone is designing and drafting each contract anew every time. More support from the Government is needed, so that people know what should be in a PFI contract and can work much more   efficiently. It is madness to waste money on avoidable legal costs because information on best practice in PFI is not provided.

We support the clause and will be interested to hear the Government's answers on any change facility. However, we also want to see much more support from the Government in ensuring that, where such contracts are put in place, any experience of, and guidance on, changes in contracts is made available, so that if a waste disposal authority wants to change the terms of its contract in light of new information or new requirements placed on it, it can do so without running up excessive costs. That should be happening now.